In a high-stakes legal battle, Rosneft-backed Nayara Energy has dragged Microsoft to the Delhi High Court. The case comes after Microsoft suspended access to several digital services, citing the European Union’s sanctions.
Nayara Energy, formerly known as Essar Oil, has called the move by Microsoft “corporate overreach.” The company has filed a petition seeking an interim injunction to resume services immediately.
This development has stirred concern across the energy sector, especially regarding India’s reliance on global tech infrastructure for its domestic operations.
Microsoft blocks access despite paid licenses
According to Nayara Energy’s official statement on Monday, Microsoft restricted access to its services without prior consultation.
The blocked services include data tools, proprietary software, and other cloud-based systems.
Nayara claims all services were “acquired under fully paid-up licenses.” Yet, Microsoft allegedly stopped support due to its interpretation of the latest EU sanctions.
This, Nayara argued, is an arbitrary and unilateral move that severely affects its operational continuity in India.
The firm further stated, “Microsoft is currently restricting Nayara Energy’s access to its own data, proprietary tools, and products.” These systems are critical to running day-to-day functions in refining and energy distribution.
Legal action in Delhi High Court
Faced with what it described as unjustified disruption, Nayara Energy has approached the Delhi High Court.
The company has urged the court to grant an interim injunction against Microsoft. It seeks to protect access to its essential digital infrastructure during the legal proceedings.
Nayara’s legal counsel argued that the suspension jeopardizes not only company operations but also national interests tied to energy supply and management.
The petition claims the move sets a dangerous precedent where foreign firms can restrict services in India based on sanctions imposed by third-party nations or unions.
Implications for India’s energy ecosystem
This case has raised red flags within the Indian corporate and policy circles. Many experts believe this could lead to a broader debate on digital sovereignty and data localization.
If critical infrastructure providers like Nayara can be digitally throttled due to geopolitical events, it poses a potential threat to national interests.
The issue also sheds light on the dependency of major Indian companies on foreign digital platforms and service providers.
Nayara noted that continued access to its digital systems is crucial to “meet its obligations to Indian consumers and stakeholders.”
With petroleum distribution and refinery operations on the line, even short-term disruptions can create ripple effects.
From Essar Oil to Nayara Energy
Nayara Energy was formed after Russian oil giant Rosneft and its partners acquired Essar Oil.
The company now operates India’s second-largest single-site refinery in Vadinar, Gujarat. It plays a vital role in ensuring fuel availability across the country.
Rosneft holds a 49.13% stake in Nayara, making it one of the largest Russian investments in India.
This association may have triggered Microsoft’s action following the EU sanctions on entities linked to Russian state-backed companies.
Tech sanctions with global consequences
While Microsoft has not yet issued a public statement, its decision is believed to be in line with recent EU rules targeting Russian businesses.
This enforcement by a US-based tech giant under EU laws, however, has raised critical questions. Can global companies enforce foreign sanctions within sovereign jurisdictions like India?
Nayara’s case may well become a landmark in deciding the legal limits of international sanctions in domestic business contexts.
Call for regulatory clarity
Industry leaders are urging Indian regulators to define clear policies around digital service access for critical sectors.
The Ministry of Electronics and Information Technology (MeitY) and Petroleum and Natural Gas Ministry may be expected to weigh in.
A favorable verdict for Nayara could set a protective legal precedent. On the other hand, it may also push global tech providers to reassess their India operations and legal strategies.
What’s next?
The Delhi High Court is expected to hear the matter this week.
If Nayara secures an interim order, Microsoft could be directed to restore access immediately.
Until then, India watches closely. The case could redefine the intersection of geopolitics, technology, and national energy infrastructure.
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