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Can US government do the same? If it can I see no problem in Indian government expecting a similar capability.

The US government has an implicit capability to eavesdrop because RIM servers are located in the country. _Requiring_ that servers be placed in your country with the _only_ purpose of being able to eavesdrop is simply despicable. You have no problem living in a country that freely imitates the human rights/ privacy record of Saudi Arabia?!

The Indian (and other govts) asked for the server to be placed in their country because otherwise RIM will invoke the technicality that that don't have to honor Indian govt's snoop requests since the server isn't located within Indian jurisdiction.

Complying with foreign snoop requests for a server located in the US may (IANAL) make it possible for somebody to sue RIM in US courts for complying with a request that didn't come from US law enforcement. So RIM is highly unlikely to honor snoop requests for servers outside the country making the demand. Hence the demand to place servers within countries interested in snooping on their citizens.

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