India builds new rules for cloud technology and data control

India is framing a sovereign-cloud policy as the government prepares to release a comprehensive consultation paper on AI regulation. MeitY set up a committee for this policy in August and held consultations with Google, AWS, and Apple in September. C-DAC has since issued an Expression of Interest for sovereign cloud services and a tender for sovereign AI cloud and data-centre infrastructure to move toward active procurement.

What Makes a Cloud Sovereign

True technological independence requires controlling underlying cloud power, chips, and data centers. Locating servers inside India does not automatically make a cloud sovereign. A truly sovereign cloud may need local control over physical infrastructure, software control systems, operations, administration, encryption keys, and data access. The framework must also clarify which country's laws govern the provider, ensuring systems remain operational during external disruptions.

Industry Reactions

Global cloud companies argue that domestic ownership is not strictly necessary for sovereignty. Microsoft offers controls through its Hyderabad data-centre region, known as India South Central. A Microsoft executive stated in a September interaction that Indian customers could obtain full sovereign control over data residency, data centres, and applicable laws. AWS provides digital-sovereignty controls and partnered with Yotta to run sensitive government workloads inside NIC data centres using AWS services, while Google offers dedicated and air-gapped infrastructure.

Domestic Alternatives

Indian technology firms are positioning themselves to provide local cloud infrastructure. TCS developed SovereignSecure Cloud for government, public-sector, and regulated workloads. Airtel Cloud offers control over data, the control plane, operations, and jurisdiction from within the country, and Yotta has built sovereign AI infrastructure. The core question is whether India should mandate Indian ownership or simply require sufficient control over both foreign and domestic providers.

Context

Cloud infrastructure has shifted from a basic IT service into vital national infrastructure due to the rise of artificial intelligence. Governments worldwide view access to advanced chips and computing power as a matter of national security and economic competitiveness, particularly in light of global technology rivalries.