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Yes, you can use SHIR hosted installed on Azure VM to access/read data from On-prem API endpoints using private endpoint connection given your VM resides in a Private/Customer Managed Virtual Network and having Express route peering or VPN connection to your On Prem network as shown in below image.
Ref documentation: Secure communication between customer networks and Data Factory
- First you will have to create private endpoint in your Private virtual network for the communication between self-hosted IR hosted in an Azure VM in the same Private VNet and Data Factory.
- Then set up an Internet Protocol security VPN connection, which is a site-to-site connection. Or set up an Azure ExpressRoute connection, which is a private peering connection between your Azure Private VNet and On Premise Network.
For implementation, you can refer to this demonstration video by a community volunteer. Though the demo focuses on On Prem SQL server, you can follow similar steps to read data from your API endpoints using Web activity or HTTP/REST connector in Copy activity as per your business need.
Video demonstration: How to Install Self-Hosted Integration Runtime on Azure VM by using Private EndPoint - ADF Tutorial
Hope this helps.
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