Federal prosecutors say the man, identified only by the initials T.S.P. In line with German privacy laws, worked at a local government office dealing with immigrants in the western state of North Rhine-Westphalia.
Prosecutors said in a statement today that the man used his access to government files to obtain and transmit information about "extremist Sikhs" and Indian opposition figures in Germany to the unidentified Indian agency.
The man has been detained since his arrest on February 17.