From railways to Aadhaar, India’s key systems run on IBM-acquired Red Hat software

In one of the biggest tech merger in the US corporate history, global tech giant IBM yesterday announced acquisition of US open software company Red Hat for $34 billion. Though the deal has been signed far from India in US, but almost every Indian is somehow related to this deal in one way or another. From railway ticketing system to stock purchases, India's biggest and critical software systems are run on Red Hat-based open source software Linux.

Red Hat is the backbone of the Bombay Stock Exchange (BSE), National Stock Exchange (NSE), Aadhaar, GST, Life Insurance Corporation of India (LIC), SBI Insurance and most core banking services across India. Many other government organisation like Central Board of Direct Taxes and Employees' Provident Fund Organisation also use the open-source software service of Red Hat extensively.

Red Hat has helped the EPFO and the BSE to revamp its data infrastructure and increase its efficiency by many fold. According to a ToI report, BSE officials said their trading response times improved significantly after implementation of the Red Hat Enterprise Linux operating system in 2016.


The Indian government has an open source policy that encourages the use of free and open source software in all government projects. According to some estimates, a study said that free and open source softwares could help India save more than Rs 8,300 crore in government expenses on education and police services.

Founded in 1993, Red Hat specializes in Linux operating systems, the most popular type of open-source software, which was developed as an alternative to proprietary software made by Microsoft Corp.

Open-source software is freely available, so Red Hat's business model depends on customers paying for the support and service it offers and not on license fees, making the company's offerings typically cheaper than proprietary software.

Unlike licence fee-based software companies like Microsoft, Red Hat charges fees for custom features, maintenance and technical support.

(Inputs from agencies)