After Nayara outage, Microsoft launches protocols to secure India’s key services

New Delhi: Three months after Microsoft abruptly suspended Nayara Energy’s communications and digital services, the US tech giant on Friday unveiled new protocols and set up a coordinating body in India to prevent future disruptions of critical operations.

In a statement, Mike Yeh, regional vice-president for corporate, external and legal affairs at Microsoft, said that the move is “designed to modernize our compliance framework and reaffirm our role as a reliable, long-term partner to the public sector and critical infrastructure domains—including healthcare, energy, telecommunications, and financial services.”

Puneet Chandok, president of Microsoft India and South Asia, will chair the customer council, Yeh added in his statement. The council will serve the public sector and critical infrastructure, communicating any regulatory impacts on Microsoft’s services in India. Other measures include a new set of review protocols, through which Microsoft will clearly convey any situation where its services to a company may be disrupted due to a foreign regulatory move.

Chandok could not be reached for comment.

Microsoft said this move will prevent abrupt service suspensions in the future. In case it faces a situation similar to Nayara, clients will be notified about any potential disruption, and given time and support by Microsoft to move to a backup cloud service—in order to ensure that its operations do not face a blackout.

Analysts said Microsoft’s move was “unsurprising”, and added that it shows a stable policy collaboration approach between the US and India notwithstanding disputes over visas and tariffs.

Policy reforms

“The move shows clear intent of importance from entities in the US as far as collaboration in technology with India is concerned. While a bilateral trade agreement is worked out, enterprises offering a proactive policy approach proves that Indian clients are among the most important for tech exports for the US—and is a mature move on Microsoft’s behalf. As artificial intelligence shapes our future, such cloud policies are crucial for India as well, and will ensure that a tight collaboration between the two nations remains on the right track,” said Kazim Rizvi, founder and director of Delhi-based policy think-tank, The Dialogue.

The move comes in the aftermath of an incident on 22 July, when Microsoft abruptly suspended its Azure cloud-based services to Nayara Energy. The suspension led to employees at the energy company abruptly losing all access to critical company data, as well as communications systems. Microsoft resumed its services on 30 July, clarifying afterward that the suspension was automatically triggered by statutory policies of its global compliance mechanism.

The suspension, Microsoft said at the time, occurred due to geopolitical sanctions imposed by the European Union on Russia, on July 18–requiring US-based tech services to not serve Russian enterprises.

Moscow-based Rosneft, a Russian government-backed oil and gas company, owns 49.13% of Nayara Energy, formerly Essar Oil, which is majority-owned by Indian entities.

Microsoft’s resumption of services was not before Nayara filed a petition against the company at the Delhi High Court, and the ministry of electronics and IT seeking a response on why Nayara’s services were disrupted—despite the latter’s licences being fully paid for. Nayara eventually withdrew the petition after the services were restored.

“The move will ensure that clients in critical sectors do not face any similar situation in future. In case of geopolitical sanctions, Microsoft will pursue legal options in the nation imposing the restrictions to ensure that a critical enterprise in India gets enough time to migrate to a backup cloud service or at least access its data—until normal services are restored in future,” a senior official at Microsoft India said.

“Microsoft remains steadfast in its commitment to making India AI-first with trust, transparency, and collaborative governance. As India accelerates its digital journey, we are proud to stand alongside the government, public sector, and critical infrastructure to support their digital and AI vision and goals. We welcome continued dialogue and reaffirm our dedication to strengthening India’s digital ecosystem with integrity, stability, security, and a shared purpose to accelerate India’s AI-first future,” Microsoft’s Yeh added.