In Focus: Safeguarding India’s Digital Economy Through a War Zone
At 05:45 UTC on a Saturday morning in September 2025, something snapped roughly 100 metres beneath the surface of the Red Sea, just off Jeddah. No explosion, no headline that interrupted the morning news in Mumbai. However, within minutes, traders watching oil markets, teams running payrolls, and cloud engineers in the technology hubs of India all noticed the same thing: the internet had gone sluggish.
Two of the world’s most important submarine cable systems, SMW4 and IMEWE, the latter literally named the India–Middle East–Western Europe cable, had been severed. Internet monitor NetBlocks recorded degraded connectivity across India, Pakistan and the UAE, and Microsoft was forced to reroute Azure traffic through longer paths. Cloud services recovered within a day; however, it was understood that repairing the physical cables would take weeks. Moreover, this would not be the first time such incidents occurred, and catastrophes were averted. In February 2024, the Rubymar, a cargo ship struck by a Houthi missile in the same waters, drifted with its anchor dragging and sliced through three major cables, disrupting close to a quarter of all internet traffic between Asia, Europe and the Middle East. A single wounded ship briefly degraded the digital arteries of three continents.
The uncomfortable truth these incidents expose: the same narrow stretches of West Asian water that carry India’s oil also carry its data, and the region’s conflict has quietly turned both into single points of failure.
A Dual Chokepoint: Barrels and Bandwidth
We are used to thinking of the Strait of Hormuz and the Bab-el-Mandeb as energy corridors. Less appreciated is that these same chokepoints are where the world’s information is funnelled. Over 95–97% of international data traffic travels not by satellite but through fibre-optic cables on the ocean floor. The Red Sea alone carries an estimated 17% of global internet traffic, with roughly 80% of Asia-to-West data riding through that single passage.
The energy crisis and the connectivity crisis are no longer separate stories; they can now arrive from the same contested sea. And the risk is escalating: amid rising tensions with Iran, Meta and its partners recently paused construction of the ambitious 2 Africa Pearls cable in the Persian Gulf. A corridor long understood through the language of barrels is fast revealing itself as a corridor of bandwidth.
What’s at Stake for India
For India, the stakes are not abstract. MeitY’s Estimation and Measurement of India’s Digital Economy report found the digital economy already accounted for 11.74% of national income in 2022–23 — about ₹31.64 lakh crore (~USD 402 billion) and projected to reach nearly a fifth of GDP by 2030, growing at twice the pace of the wider economy. UPI rails, IT exports, data centres, fintech and cloud-dependent enterprise all rest on one unspoken assumption: that international connectivity is always on.
In India’s case, that assumption is geographically fragile, as its subsea connectivity lands at a handful of stations clustered across just five cities, Mumbai, Chennai, Cochin, Tuticorin and Trivandrum, and much of its westbound traffic threads through the very corridor now under strain. After the September cuts, operators reported no domestic outage, citing multiple alternate routes. But redundancy is not immunity: rerouting buys continuity at the cost of latency, and many “alternate” paths still pass through the same gateway. A buffer built for the occasional accidental anchor-drag is a very different thing from resilience built for sustained, deliberate disruption.
Where India’s Policy Stands
India has a regulatory scaffolding for subsea cables, but it was built to ease commerce, not withstand conflict. Under the Telecommunications Act, 2023, the DoT issues licences, and companies laying cables in Indian waters must hold an International Long Distance licence and run Cable Landing Stations (CLS) under TRAI’s rules.
The pivotal intervention came in June 2023, when TRAI released its recommendations on the Licensing Framework and Regulatory Mechanism for Submarine Cable Landing in India, introducing a two-tier Main CLS / CLS-PoP model. Crucially for resilience, TRAI also recommended recognising cable operations as critical and essential services, exempting repair equipment from customs duty and GST, and mandating Indian entity-owned vessels for repair to cut reliance on foreign ships. More recently, the Captive Telecommunication Services Rules (drafted September 2025, finalised early 2026) let hyperscalers and large enterprises land their own private cables.
The gap is now visible. Almost all of this machinery is oriented toward easing landing and ownership, far less toward addressing resilience, route diversity and repairing sovereignty when the threat is geopolitical. Several of TRAI’s most security-relevant ideas remain recommendations rather than mandates.
What the Government Should Do
If 2025 made the threat undeniable, the next window is the time to act. Five priorities stand out:
Operationalise “critical infrastructure” status- move TRAI’s recommendation into statute, with a nodal security agency, mandatory incident reporting, and fastest-tier clearance for repair.
Mandate route diversity- incentivise cable systems that bypass the Red Sea–Hormuz corridor, so a single conflict cannot throttle westbound traffic.
Build repair sovereignty- fast-track the Indian-flagged repair-vessel proposal, converting a multi-week vulnerability into a manageable one.
Diversify landing geography- expand beyond the five-city cluster so one disrupted node does not cascade nationally.
Institutionalise a Centre–industry resilience forum- a standing body for the DoT, security agencies and cable consortia to share intelligence, run drills, and maintain a public incident protocol.
The Inflexion Point
India cannot move the war, nor the geography. What it can decide is whether the fifth of its economy running on digital rails rests on a corridor it does not control. The new cables — IAX, IEX, 2Africa are still being commissioned; the captive-cable rules are freshly minted; the resilience playbook is still being written. The moment to embed security into that architecture is now, before the next anchor drags across the seabed.
For a nation aspiring to Viksit Bharat 2047, Energy security has long been an article of strategic faith. It is time bandwidth security earned the same status. The barrels and the bytes now travel the same troubled waters and India’s policy must learn to protect both.
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