VPN Regulation in India, Government Weighs Stricter Rules for VPN Providers

VPN Regulation in India Latest News

• The Centre is working on an expansive legal framework to regulate Virtual Private Network (VPN) providers. The proposed rules could require VPN companies to establish a local presence in India and appoint compliance officers to liaise with the government. 
• The primary concern driving this: VPNs are increasingly being used to bypass the government’s blocking of apps and online content.

What Is a VPN and Why Does It Worry the Government

• A VPN lets users mask their IP address and route their internet traffic through servers located elsewhere, making it appear as if the traffic originates from another country while hiding the user’s real location.
• This creates two features the government finds problematic:
  • Bypassing censorship: India’s blocking orders require companies to geo-block content within India’s jurisdiction. But by connecting through a VPN server in, say, the US, a user can still access content blocked in India.
  • Anonymity: VPNs allow anonymous browsing and are widely regarded as privacy-enhancing tools.
• The scale of the tension is clear from India’s expanding censorship: over 24,000 blocking orders in 2025, up from over 12,000 in 2024. 
• When the Centre temporarily blocked Telegram before the NEET-UG retest, Proton VPN reported daily sign-ups from India jumping over 120% — illustrating exactly why VPNs “defeat the purpose” of blocking, in the government’s view.

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What the New Framework Could Require

• According to senior officials, the proposed rules could require VPN operators to:
  • Establish offices in India.
  • Hire compliance officers to address government grievances.
  • Face penal consequences, including possible jail terms for local employees, in case of non-compliance.
• These requirements mirror obligations already imposed on large social media companies under India’s Information Technology (IT) Rules, 2021. 
• The core goal is to have a local point of contact the government can direct to block access to prohibited content.

The Backstory: The 2022 Cert-In Directive

• This is not the first attempt to regulate VPNs. 
• In 2022, the Indian Computer Emergency Response Team (Cert-In) issued a controversial directive requiring VPN providers (along with data centres and cloud service providers) to store extensive customer data — names, email IDs, contact numbers, and IP addresses — for a period of five years.
• Why a new law is now felt necessary: There is an implicit acknowledgement that the 2022 directive did not yield satisfactory results. 
• As per analysts, VPN companies “simply refused to comply,” so a full-fledged law is being considered.

The Industry’s Response Servers Moved Out

• The 2022 directive backfired in a telling way. Rather than comply, major VPN operators — Proton VPN, NordVPN, ExpressVPN, and Surfshark — removed their physical servers from India and began routing Indian traffic through Singapore.
• Proton VPN was blunt at the time, calling it an “invasive mass surveillance law” and saying it had no choice but to pull its servers out of Indian jurisdiction.
• This episode highlights the core enforcement challenge: because VPN companies can operate entirely from outside India, forcing compliance is difficult — which is precisely why the government now wants a mandatory local presence.

The Underlying Tension: Security vs. Privacy

• The story sits at the intersection of two competing concerns:
  • The government’s position: VPNs undermine lawful content-blocking and enable circumvention of orders issued on security and other grounds; a local, accountable presence is needed for enforcement.
  • The privacy concern: VPNs are legitimate privacy-enhancing tools, and data-retention or localisation mandates raise fears of mass surveillance and erosion of user anonymity.

Conclusion

• The proposed VPN framework is the government’s second, tougher attempt to bring a hard-to-regulate technology under its control. 
• Where the 2022 Cert-In data-retention directive largely failed — pushing providers to simply relocate their servers abroad — the new approach borrows the IT Rules playbook: mandate a local office, a compliance officer, and personal liability for employees. 
• The move underscores India’s expanding content-blocking regime, but it also reopens a fundamental debate. 
• VPNs are both a tool for evading censorship and a legitimate shield for privacy. How the eventual law balances enforcement against the surveillance concerns raised by providers and civil society will be its real test.

Source: IE