At least seven State Load Dispatch Centers close to the Indo-China border in Ladakh have been found to be targetted by a suspected Chinese state-sponsored threat group called TAG-38.
These SLDCs conduct real-time operations for grid control and electricity dispatch and hence are critical infrastructure in the region. The attack is believed to have started by the infiltration of internet-facing third-party devices like IP cameras that may have been vulnerable due to them having default credentials.
In addition to attacking the power grids, the operation also impacted a national emergency response team and the Indian branch of a logistics company. The operation used a trojan called ShadowPad which is believed to have links to contractors working with the Chinese Ministry of State Security.
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Dragon in the valley
Cybersecurity firm Recorded Future’s Insikt group reported that the targeting has been geographically concentrated and one of these SLDCs has been previously targeted in 2020 in an incident the group labelled RedEcho and attributed to China as well.
However, since the targeting was prolonged, the main objective of the hack is believed to gather information about critical infrastructure, which could be later used to gain access to a system and take possibly disruptive actions in the future.
Recorded Future reported discovering a Command and Control (C2) infrastructure targeting critical infrastructure in Ladakh for months. This infrastructure involves the hacked DVR/IP cameras and uses Fast Reverse Proxy’s open-source tool. The firm also found that identified C2s share a unique SSL certificate spoofing Microsoft. The certificate has multiple links to wider Chinese state-sponsored cyber espionage activity.
The use of ShadowPad across Chinese threat groups is growing over time. At this time, the Insikt group is tracking at least 10 different activity groups with access to ShadowPad, a software developed and used by MSS-linked contractors linked to the APT41 intrusion set.
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