Govt keen firms in critical sectors use ‘Made in India’ cloud systems, Pg1

Key Highlights:

• Government considering mandating companies in critical sectors like energy, telecom, and banking to use Made-in-India sovereign cloud systems.
• The move aims to reduce dependence on foreign cloud providers and enhance data security amid rising geopolitical and cybersecurity concerns.
• The consideration was prompted after Microsoft blocked Nayara Energy from its IT services in 2025 due to EU sanctions.
• Nayara Energy sued Microsoft in the Delhi High Court, following which services were restored.

Detailed Insights:

• The incident involving Nayara Energy raised concerns about the dependence of Indian companies on foreign entities for crucial digital infrastructure services.
• Cloud systems offer scalability and cost efficiency by providing on-demand, internet-based computing resources hosted in remote data centers.
• A key challenge is the current lack of globally competitive domestic cloud systems in India, making companies prefer superior foreign options.
• The government aims to ensure no sudden disruptions and to insure against geopolitical risks by promoting sovereign clouds.
• Microsoft admitted the block was due to an automated "legacy" compliance system calibrated for less complex sanction regimes.
• The company has since changed its enforcement mechanism, adding a review process by its senior leadership before suspending services.

Key Concepts Involved:

• Sovereign Cloud: A cloud computing environment where data is stored and processed within a country's borders and under its laws.
• Geopolitical Risk: Risks associated with political events, international relations, and conflicts that can impact businesses and economies.
• Data Security: Measures taken to protect digital data from unauthorized access, use, disclosure, disruption, modification, or destruction.