Anti-sanctions law India: Government Explores EU-Style Blocking Law

Context: Anti-sanctions law India

India is examining an European Union–style anti-sanctions (blocking) law after foreign firms withdrew services to Indian companies citing external sanctions (Nayara Energy case).

Issue

1. Indian firms rely on foreign digital/financial services
2. Providers may stop services due to home-country sanctions (extra-territorial)
3. Threat to economic sovereignty + critical infrastructure

Trigger

1. Microsoft suspended services to Nayara Energy
2. Disrupted data, software, communication systems
3. Exposed dependence on foreign service providers

India’s plan

1. Exploring a blocking law (EU model)

Likely features

• Bar foreign firms from complying with external sanctions in India
• Ensure services via India-based entities
• Make such sanctions invalid within India

European Union model

1. EU Blocking Statute (Regulation 2271/96, 1996)

Key provisions

• Ban compliance with extra-territorial sanctions
• Nullify foreign rulings
• Allow damages recovery

Aim

Protect firms from United States sanctions (Iran, Cuba)