The Economic Times reports that the Home Ministry has not allowed Tata Teleservices ("TataIndicom" brand) to give Blackberry services to its customers. Tata Teleservices wanted to provide Blackberry services to its customer along with Blackberry devices and hence had sent an application to the Department of Telecom (DOT). But the Home Ministry has rejected the application with an explanation that Blackberry devices do not allow lawful interception of messages.
The Indian Home Ministry has a law where telecom operators can be asked to intercept messages from any mobile phone and the operators have to comply. The push email, data services in RIM's Blackberry devices are encrypted and secure which prevents the operator from understanding the messages (look here). But the question which Tata Teleservices has asked the DOT is that if this is the case, then how come other telecom providers (read BPL-Mobile, Airtel...) can provide Blackberry services. Obviously, the government was sleeping when they allowed those service providers and suddenly caught with its pants down, it ordered other service providers for an explanation.
The situation just goes to show the incompetence of government agencies and it is plain ridiculous to ban the Blackberry. Webmail using gmail, yahoo etc is also encrypted and the ISP has no idea what emails are being sent. Technology is moving towards a point where any data exchange needs to be encrypted. I know atleast 40-50 people around me who are using Blackberry and business email on the Blackberry is their life... The government should come to terms with technology and then make decisions!