India gives BlackBerry 60-day reprieve

India on Monday gave the makers of the BlackBerry smartphone a 60-day reprieve on a threat to ban its messaging services, saying it would test proposals by the firm to give law enforcers access to data.

The announcement came after government and security officials met to review proposals by Canadian company Research in Motion (RIM) to allow security forces to decode the heavily encrypted email and other messages carried on the handsets.

"The Home Ministry will review the security issue relating to Blackberry services within 60 days, by which time the Department of Telecommunications will submit its report," a government statement said.

New Delhi threatened earlier this month it would ban corporate emails and BlackBerry messenger chatting services on the smartphone unless the company came up with a way for security agencies to monitor them by August 31.

India, which struggles with a host of home-grown insurgencies and threats from terror groups based in neighbouring Pakistan, is worried the encrypted messages could be used by militants to coordinate attacks.

RIM made "certain proposals for lawful access by law enforcement agencies and these would be operationalised immediately", the home ministry statement said.

"The feasibility of the solutions offered would be accessed thereafter".

For RIM, whose shares have been trading at 52-week lows, striking a deal with India has been crucial to ensure the company is not shut out of the world's fastest-growing cellular market.

The statement capped weeks of talks between RIM and the government on ways monitoring could work without the firm abandoning its public commitment not to directly aid governments in decoding its messages.

There was no immediate comment from RIM on exactly how it planned to satisfy the Indian government's demands.

It has continually insisted it makes no "special deals" with any government involving access to communications carried on its handsets and analysts say its commercial success has been due to its gold-plated data protection reputation.

At the same time, analysts note other security-conscious nations such as China and Russia appear to be satisfied that their intelligence agencies have sufficient access to BlackBerry communications, although the specifics of the arrangements between RIM and these countries are not known.

India's Ministry of Home Affairs has "made it clear any communication through the telecom networks should be accessible to the law enforcement agencies", the statement said.

BlackBerry has also been facing a threatened ban by the United Arab Emirates and is negotiating with Saudi Arabia on security issues. Other countries have also been making noises of concern about security access.

Eyeing BlackBerry's market share, Finland's Nokia, one of RIM's biggest rivals in India, said Monday it had already satisfied the government's security concerns and faced no problems.

Nokia was installing a server in India "for hosting mail and ensuring the government has (security) access," said Nokia India managing director D. Shivakumar.

The government - keen to project India as an investor-friendly economy - had said earlier it would prefer not to shut down the operations of BlackBerry, widely used by the country's elites, saying it was "not in the business of shutting down services."

At the same time it stressed New Delhi was not ready to sacrifice its security interests.

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