Cloud Cut-Off Chaos: How Microsoft Locked Out India’s Nayara Energy Over Russian Ties — Then Backtracked
By Gurkha Insight • UK & World News • Aug 26, 2025 19:25 PM • 33 views
In a dramatic turn that sent ripples through India's corporate landscape, Nayara Energy, a prominent oil refiner in the country, found itself in a digital lockdown. The crisis began quietly on July 18, when the European Union officially sanctioned Nayara Energy due to its ownership ties to Russian oil giant Rosneft. While India doesn't adhere to EU sanctions, the news set off an unexpected chain of events.
Just days later, without prior warning, Microsoft abruptly suspended all its services to Nayara. This meant employees were locked out of critical platforms like Outlook and Teams, and vital business data became inaccessible. For a company operating 24/7 refinery operations, this was more than an inconvenience; it was a plunge into chaos, threatening to disrupt India's energy supply.
"We had fully paid software licenses," a Nayara spokesperson stated, expressing shock. "But we were cut off completely without notice."
Facing an unprecedented digital blackout, Nayara immediately scrambled for alternatives. In a move that highlighted the resilience of India's local IT ecosystem, they swiftly turned to Rediff.com, a veteran Indian internet company, to help restore essential internal communication. While Rediff.com successfully facilitated ongoing communications for Nayara employees, the crucial historical emails and data stored on Microsoft's cloud remained frozen. The impact wasn't limited to digital infrastructure; tankers carrying Nayara's fuel faced delays and diversions as international shipping firms grew wary of the sanctions' repercussions.
As the crisis deepened, Nayara took legal action, filing a lawsuit against Microsoft in the Delhi High Court. The refiner argued that the service suspension was unjustified and inflicted severe damage. With a critical court hearing looming, the pressure mounted on Microsoft.
In a sudden development, just hours before it was due to explain its actions in court, Microsoft restored all services to Nayara on July 30. Following the full restoration, Nayara promptly withdrew its lawsuit, for now, acknowledging the "prompt intervention of the Hon'ble Delhi High Court."
While Microsoft has restored services, stating its commitment to customers in India and ongoing discussions with the EU, the incident has sparked a larger debate in India about digital sovereignty and the potential for global corporations to extend foreign legal frameworks into jurisdictions where they may not apply. Nayara Energy maintained that its operations are fully compliant with Indian laws and regulations, and the unilateral action by a US-headquartered company raised significant concerns about "corporate overreach." The episode underscored the critical importance of robust and independent digital infrastructure for Indian businesses.
