The Compliance Distraction: How Minor Fines Mask Systemic Cybersecurity Vulnerabilities

A recent flurry of regulatory fines in India's corporate and aviation sectors has exposed a troubling pattern with significant implications for cybersecurity and systemic risk management. On the surface, these actions—a substantial ₹22.20 crore (approx. $2.7 million) penalty levied by the Directorate General of Civil Aviation (DGCA) against IndiGo for operational disruptions in December 2025, and a minuscule ₹5,900 (approx. $71) fine by the Bombay Stock Exchange (BSE) against Desco Infratech for late disclosure of related-party transactions—appear to demonstrate regulatory vigilance. However, a deeper analysis reveals a regulatory paradigm dangerously focused on symptoms rather than root causes, creating a compliance smokescreen that masks profound systemic vulnerabilities.

The core issue lies in the nature of the violations being penalized. The DGCA's fine against IndiGo, one of India's largest airlines, addresses the consequence—widespread flight disruptions—but public reporting focuses on the financial penalty's size relative to the airline's daily revenue, estimated to be in the range of ₹100-120 crore. This framing reduces the incident to a financial calculus, asking whether a fine amounting to roughly one-fifth of a day's income is a sufficient deterrent. For Desco Infratech, the fine is so nominal it functions as little more than an administrative slap on the wrist for a procedural lapse in governance disclosure.

From a cybersecurity and systemic risk perspective, this is where the critical blind spot emerges. What caused IndiGo's operational disruption? While specific technical details from December 2025 are not fully public, major airline disruptions in the modern era are rarely purely mechanical. They are increasingly the product of cascading failures in complex, interconnected digital systems: IT network outages, failure of crew scheduling software, cybersecurity incidents disrupting backend operations, or supply chain attacks affecting maintenance logistics. Similarly, a company's failure to disclose related-party transactions in a timely manner (as with Desco Infratech) often points to deeper flaws in internal data governance, audit trails, and the integrity of financial reporting systems—all domains heavily reliant on secure and resilient IT infrastructure.

Regulators are effectively issuing parking tickets for speeding, while ignoring the fact that the car's brakes and steering are fundamentally faulty. The fines punish the manifestation of a problem (late filing, disrupted flights) without mandating or investigating the underlying security and resilience failures that made the problem possible. This creates a perverse incentive structure. For a corporation, it becomes more economically rational to budget for occasional regulatory fines as a cost of business rather than invest heavily in overhauling legacy systems, implementing robust cybersecurity frameworks, or building redundant, resilient architectures. The fine, even a large one like IndiGo's, is a known, quantifiable expense. The investment required to fortify systemic integrity is open-ended and substantial.

This misalignment poses a direct threat to national and economic security. Critical infrastructure—aviation, finance, energy, healthcare—is built on digital foundations. When regulatory enforcement focuses on procedural compliance checkboxes (Was the report filed on time? Were passengers compensated per rule?), it fails to assess the health of the digital bedrock. A company can be "compliant" on paper while running its core operations on unpatched, interconnected systems with single points of failure, inadequate access controls, and no effective incident response plan for a cyber-physical disruption.

The cybersecurity community must lead the charge in reframing this debate. Our role is to translate technical risk into regulatory and business imperatives. We need to advocate for a new generation of regulations that employ a "resilience-by-design" principle. Penalties should be structured not just for the procedural miss, but for the absence of proven resilience measures. For instance:

• Fines Linked to Security Investment Gaps: Penalties could be scaled based on audits revealing critical cybersecurity control failures (e.g., lack of network segmentation, poor patch management hygiene) that contributed to an incident, rather than just the incident's operational impact.
• Systemic Risk Assessments: Major fines should trigger mandatory, in-depth third-party audits of the organization's entire digital supply chain and systemic interdependencies, with results shared (in a sanitized form) with sectoral regulators to map broader ecosystem risks.
• Transparency on Root Cause: Regulatory settlements should require public disclosure of the technical root cause of major disruptions, moving beyond vague "operational issues" to specifics like "software failure in the flight planning module" or "cyber-incident affecting ground handling data." This transparency drives industry-wide learning and accountability.

The cases of IndiGo and Desco Infratech are not isolated. They are symptoms of a global regulatory shortcoming. As systems become more complex and interdependent, the gap between procedural compliance and genuine security widens. Treating minor fines as evidence of a functioning regulatory system is a dangerous illusion. For true security and stability, we must demand that regulators look past the fine print and start addressing the faulty code, the fragile networks, and the systemic vulnerabilities that lie beneath.