Nokia will set up servers in India by November for its push email service in the country to comply with government regulations, the company said. The announcement by Nokia comes a day before an Indian government deadline to Research In Motion to provide access to some BlackBerry services to law enforcement agencies. Nokia has the largest share of the smartphone market in the country, according to estimates by research firm Gartner. The company has been running a beta of its Nokia Messaging Service in the country from last year.

The Indian government has ordered service providers offering BlackBerry enterprise server and instant messaging applications to ensure that these services can be intercepted by security agencies by August 31, or face a block of these services. Indian government officials are meeting in Delhi later today to take a final call on the various solutions proposed by RIM, according to reports.

RIM proposed last week to lead a forum to assist the Indian government on balancing the need for access of law enforcement agencies with the security needs of corporations. The company did not specify who would be the other members of the forum, nor did it address the immediate issue of the ban threat from India.

Access to the enterprise service for security agencies has been a sticking point in the negotiations between the government and RIM, according to informed sources.

Nokia said earlier this month that it was prepared to assist the applicable government authorities with their requests for a high degree of security and was in the process of installing the required infrastructure. The company said on Monday that it follows all local laws and regulations that are required by government authorities. Nokia said it is also committed to protecting its users' privacy and maintaining their trust.

Although the BlackBerry has attracted considerable attention because of the Indian government's security concerns about its encryption of data, it is not a runaway success in India as smartphones make up a small part of the mobile handset market. About 6 percent of the 140 million mobile phones sold in India this year are likely to be smartphones, Anshul Gupta, principal research analyst at Gartner, said earlier this month.

India added 18 million new mobile connections in June, taking the total number of subscribers to 636 million, according to the Telecom Regulatory Authority of India.

A number of companies that had earlier standardised on the BlackBerry are now considering allowing staff to use other devices, like the iPhone from Apple and devices from Nokia, to access corporate mail. IBM already allows staff in India to access mail from other approved devices, while outsourcer iGATE is moving in that direction as its employees are demanding choice.

Some other companies such as Dell and Yahoo in India require employees to use the BlackBerry for official email, but employees who qualify are few, and are usually those who are on the move, according to sources.