Daybreak - What does Zoho offer as India’s new official email provider: security or Indianness?

Episode Date: May 17, 2026

The Indian government just moved two million email accounts off NIC's servers onto Zoho's cloud. The reason the government decided to leave behind a system it had built and run for 40 years? A list of issues; including ransomware attacks, power outages, and even a blackout on a New Year's Eve that knocked out Parliament's website.The fix was a seven-year, 200 crore rupee contract with a private Indian company. Zoho actually scored lower than Google and Microsoft in the government's own assessment. Bur it won the assessment anyway.Thing is, India spent years building open-source infrastructure to stay independent. The question is whether it just traded one dependency for another.Tune in.Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.

If a Ministry of Railway employee opens her inbox today, everything looks the same. Her email address still ends in the usual GOV.N. The login page still shows the logo of the NIC or National Informatic Center, the government's tech partner. Even the help test number is the same. But behind the scenes, something has shifted. By April 1st, more than a month ago, nearly 2 million of the NIC's 3 million plus government email accounts had been moved to the service of Zohorco Corporation, a 30-year-old cloud software company from India. This shift was first announced in the parliament by Jitin Prasad, the Minister of State for the Ministry of Electronics.

The remaining accounts are expected to transition by mid-20207. The government is spending almost 200 crore rupees on this migration. But for Zoho, that amount may as well be loose change, considering that it posted more than 3,000 crore in profit on a 12,000. million last year. What Soho does get, though, is bragging rights. It now has the ability to say that it runs the internal communications of one of the world's largest governments.

For the government, this is lesser technology upgrade and more an escape. The IT secretary himself called out considerable issues with NIC emails in terms of security breaches. That's a list of issues that goes from ransomware attacks to power out. For example, on New Year's Eve 2024, a power cut at NIC's study data center knocked out Parliament's website, the Press Information Bureau and dozens of ministry pages for hours. Two years before that, a ransomware attack on IME's deadly had exposed more than a terabyte of patient data. For the government, security and stability was obviously becoming a high priority. For Zohoh, on the other hand, these gains are mostly in optics.

You see, only 30% of its revenue comes from Asia. So, a deal with the Indian government fits quite neatly with Sridha Vembu, the founder of Zohos, Atma Nirphar Bharat rhetoric, and opens doors for government procurement conversations elsewhere. But by trading a 40-year relationship with NIC's open-source software for a seven-year-one with Zohos proprietary stack, the government may simply be swapping one dependency for another. Welcome to Daybreak, a business podcast from a business podcast from a company. the can. I'm your host Rachel Virgis and every day of the week, my co-host Nikla Sharma and I will bring you one news story that is worth understanding and worth your time. Today is Monday,

the 18th of May. Now, Zohom may have won the contract up till 2030. But during the assessment, it wasn't exactly the highest ranking service then. Minister Rushvani Wehshnab admitted as much. He said that last October, global and Indian organizations were both assessed on several parameters. Out of the organizations assessed, Google received a score of 8.9, Microsoft 8.8 and ZOHO 8.6. This assessment was in response to METI or the Ministry of Electronics and Information Technology initiating a procurement process in 2023 to modernize NIC's email infrastructure. The shortlisted vendors, including ZOHO, submitted proofs of concept through the government's e-marketplace portal. After the first round, Indian

vendors were given a chance to improve their bids. And Zoho upgraded its security features within six months. Vashnav said that post-tendering, Zoho's bid was the best. And so, it ended up being the one chosen. The reason Zoho got a second chance was pretty straightforward. The government was looking for an exit strategy from NIC's failing infrastructure, but it didn't want to hand over control to a foreign company. So, Zoho was a compromise.

And soon, the Education Ministry issued an order asking officials to adopt Soho Suite, framing it as being in alignment with the government of India's broader vision of building a self-reliant technology ecosystem. In an email response to my colleague, the Kent Reporter Indarpal Singh, Zoho described its government offering as a custom rebranded version of Zoho workplace that lets departments run email and communications on what it called a secure indigenous platform. Here's how the contract works. It prices email at $170 to $300 per account per month, depending on mailbox sizes, which range from 30 to 100 GB.

If you add in the full ZohoSuite, the cost per employee crosses more than $1,000. That's in comparison to Google and Microsoft's entry level plan would start at $125 to $136, while enterprise plans scale to $1,600 to $1,700. But here's one thing that the cost of $1,000,000,000. contract side steps. You see, a former Zoho developer on the project told us that officially NIC still owns and operates the system even though the data has been moved to Zohos cloudware

and Zoh software is now managing it. It's kind of like this. The nameplate on the door still says NIC, but the one keeping the lights on inside is Soho. Part of the reason is that changing habits has not really been easy. For example, employees had to be nudged into switching to Zohosuite and Métis was especially insistent on them moving away from open source tools like Libre office because of security concerns. That's actually a pretty sharp U-turn from the government's own 2015 free and open source software policy. It said that it would endeavour to adopt open source software in all e-governance systems as the preferred option. So what changed between 2015 and now? Stay tuned. The cracks actually began showing

last November. This was when NIC told West Bengal's chief electoral office to move its election data off NIC servers and onto its own cloud hosted within West Bengal. This was welcome news for an office dealing with constant glitches during voter roll checks. At the same time, NIC also asked all non-central government entities to do the same thing. These kinds of small but repetitive issues is what eventually turned the tide against NIC's open source setup. A former employee told Indarpal that while emails and a cloud platform called Meghraj haven't done so well, NIC continues to handle e-offices, e-codes and vehicle registration through Pariwahan and portal creation. Deepro Guha of the Quantum Hub, a Delhi policy firm that works with METI said that the government

has realized now that it can't build and manage all IT services. Of course, it has built good infrastructure like UPI for example, but services like Meghraj and government just haven't landed with the same success. But here's the irony. Global trends are moving in the opposite direction. Governments worldwide, which are worried about data sovereignty, vendor lock-in and licensing costs, are all moving towards open source. For example, Denmark said in 2025 that it would ditch Microsoft Office for Libra Office.

A year earlier, Germany began migrating 30,000 government employees to Linux, swapping word for Libra office, outlook for Thunderbird and SharePoint for Next Cloud. India, on the other hand, is moving in the other direction. It's discouraging open source tools, giving the reason that they could compromise the security of files. And this creates a different kind of trade-off altogether. You see, proprietary software like Zohos runs on a closed, hidden code base. The government has to take Zohos claims of safety in good faith. It's the polar opposite of NIC source code, which is the kind that is visible to everybody.

That means agencies like certin can independently audit software for backdoors and vulnerabilities. Certain, by the way, is the Indian Computer Emergency Response Team, a national agency for cybersecurity under METI. So when it comes to software like SOHO's security agencies like these can't really conduct the audits that they need to. But there's also a more important question here than just open. open versus closed software. It's about systems the government can run itself and those it needs to rely on a vendor for. S. Krishnan, who's the Métis IT secretary, argued that private sector companies, because of the sheer scale of its users, face larger risks of attacks and therefore built better defenses

than any government entity ever could. The only condition was this. The vendor had to be Indian. But all of this still comes with a catch. You see, picking a single vendor, Indian or not, and standardizing an entire government software stack around it, is how you end up in kind of a walled garden. Let me explain. You see, this just means that users will be left with some questions.

Will a document created on Zohor writer open cleanly on Libra office? Can Zohomail data be easily shifted to another software if the government picks up a different company when this contract ends? Well, no one is quite sure right now. But there is a way around it. And it is called interoperability, which is basically the ability that a system has to work smoothly with another system or to be replaced by it.

Now, Sridah Vembo has spoken about interoperability before. It was in the context of Soho's messaging app called Aratai. But as far as the Zohomati deal is concerned, this hasn't really been addressed in public yet. Unless that changes though, METI might just find itself in another five years, negotiating from a weaker position than before. The only difference this time is that it won't be with NIC.

It will be with Soho. Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription offers daily long-form feature stories, newsletters and a whole bunch of premium podcasts. To subscribe, head to the Ken.com and click on the red subscribe button on the top of the Ken website. Today's episode was hosted and produced by my colleague Rachel Vargis and edited by

Rajiv Sien.