Skype crypto is a trade secret. Some say that its crypto confounds western governments attempts to monitor communications, but its cryptographic strength and integrity remains an unknown quantity, so it should be assumed to be compromised.

However, as a number of countries have expressed concern about the use of skype crypto, one might be tempted to assume that not every government has the capability to eavesdrop on skype traffic, after all, if they could then they would have nothing to lose (and everything to gain) by its widespread use.

My knowledge of Indian national issues with Skype comes pretty much from the BBC and IIRC Slashdot. Try this for a starter.

So the question really boils down to this: from whom do you seek to ensure secrecy, your own government or someone else's?

It's pretty much a meaningless question in this context though, as there doesn't seem to be any really 'secure' communications mechanism available to us (except for SSH and VPNs) on our N900s. Support for PGP/GPG email encryption would be a good start.