"Voice, SMS and individual email communications can be intercepted and monitored by security agencies in readable format," India's Minister of State for Communications Sachin Pilot told Parliament in a written submission.

"However, security agencies are not able to intercept and monitor the communications" made through BlackBerry's corporate e-mail and messenger chatting services, Pilot said, adding that the government is still "engaged with Research in Motion to find a solution."

These remarks hint that the government has yet not made any headway with RIM despite its warning to the Canada-based firm that it may ban the services if the BlackBerry phone maker doesn't comply with its interception demands.

India, which is testing solutions offered by RIM, wants to monitor its corporate email and messenger services, fearing BlackBerry's heavy encryption makes the smartphones convenient for terrorists to use without being monitored.

On its part, RIM said that the Indian government had agreed to work with individual enterprises if it wants access to communications sent via BlackBerry enterprise services.

"The (Indian) government has acknowledged that any potential policy or approach that requires lawful access to strongly encrypted enterprise data sent to or from corporate and government organizations ... would need to occur through the enterprise customers themselves since RIM has no ability to provide the customers' encryption keys," RIM said.

While the Indian government said it cannot yet monitor communications through the instant messaging service, RIM contended that it is fully cooperating with the government in India.

"RIM confirms that it is fully cooperating with the government of India and is enabling carriers in India to be able to provide the same degree of lawful access to consumer data services, including BlackBerry Messenger, that occurs with respect to other consumer products and services offered by other companies including RIM's competitors," it said.

In October, the Indian Ministry of Home Affairs acknowledged RIM's progress and indicated that BlackBerry Messenger services will continue to be available, said RIM, which is supposed to offer a solution for intercepting its BlackBerry messenger services by the end of January, 2011.

"We are confident that any outstanding concerns between RIM and the government of India can be resolved to our mutual satisfaction," the company added.

The controversy in India, where the smart phone market is forecast to grow to 40 million by the end of 2015, isn't the only roadblock RIM has faced this fall. Saudi Arabia and the United Arab Emirates had similar concerns related to data monitoring.

While RIM is still in talks with the Saudi government, the UAE dropped its plans for an Oct. 11 ban, saying its BlackBerry services had been brought into compliance with the Gulf state's regulatory framework, though it did not provide details of the changes.

India, which is the second largest mobile phone market in the world after China, is expected to record more than 600,000 BlackBerry sales this year, according to Informa Telecoms & Media forecast.

Separately, Nokia, another cell phone manufacturer, has announced installation of servers in India, which would allow security agencies to intercept e-mail and messenger services provided by it.

The move, apart from conforming to freshly issued requirements of Indian regulators, may also force competitor RIM to make similar arrangements.