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The Bharatiya Janata Party has said that if it comes to power it will create a policy environment where companies such as Google, Facebook and Yahoo will be encouraged to set up servers in India.
An official who is part of BJP's information technology team said the party is in discussions with various foreign and Indian IT companies and is keen to provide policy support to firms that currently have their servers outside the country.
"We are not forcing them, but it is our opinion that they should bring the data to India," said Vinit Goenka, national co-convenor of the IT cell of BJP, which is regarded as the frontrunner to form the government when results are declared on May 16.
Goenka, who also oversees e-governance for BJP, said the government has failed to create a sustainable technology policy environment to encourage companies to host Indian internet users' data within the country amid rising concerns about data security and privacy. "We are losing revenue out of it, and it is also a security threat to us. So that is the whole idea."
Concerns about data security increased after revelations by former US National Security Agency contractor Edward Snowden last year that the American government had direct access to large amounts of personal data from companies like Google, Facebook and Yahoo.
Over the past year, internet activists and privacy advocacy groups have been asking these companies to set up servers in India to ward off potential security threats and data breaches.
Government officials say companies such as Google and Twitter often deny their requests on user information as they are not bound by Indian laws.
"Why should most of the institutions in India have their data across the border, in other economies ... I don't doubt the intention of that country but tomorrow, for argument's sake, if they want to intrude into my data, they always can do that. So why should I leave this chance?" Goenka asked.
Cyber security experts said the absence of local servers raises privacy concerns and can complicate investigation of internet-related matters.
"These companies make huge amount of money from India, but they run away from the law," said Prashant Mali, an advocate specialising in cyber law and chairman of Mumbai-based Cyber Law Foundation.
Mali said that at present y gathering personal information about an internet user as part of an investigation can take between six months to a year as the request has to be routed through the US-based internet company and then the home affairs department in New Delhi.
"We believe that all sectors of the economy benefit from the ability to move data across borders. These benefits are due, in large part, to the advances in computing made possible by the internet -- which has lowered costs, increased productivity, and levelled the playing field," Google said in an emailed response to ET. Facebook did not offer comments.
