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Legal framework

National arbitration laws
What legislation applies to arbitration in your jurisdiction?

The Arbitration and Conciliation Act 1996 is the key law governing arbitration in India. The act has four parts:

  • Part I sets out general provisions on domestic arbitration;
  • Part II addresses the enforcement of foreign awards (Chapter 1 deals with New York Convention awards and Chapter II with awards under the 1927 Geneva Convention);
  • Part III deals with conciliation; and
  • Part IV sets out certain supplementary provisions.

Parts I and II are the most significant and are based on the UNCITRAL Model Law and the New York Convention respectively.

Mandatory laws
Are there any mandatory laws?

There are no mandatory laws governing arbitration in India, except the Arbitration and Conciliation Act, which ensures party autonomy in respect of most procedural matters.

New York Convention
Is your country a signatory to the New York Convention? If so, what is the date of entry into force?

India signed the New York Convention on June 10 1958 and ratified it on July 13 1960. The convention entered into force on October 11 1960.  

Are there any reservations to the general obligations of the convention?

India applies the convention only to the recognition and enforcement of awards made in the territory of another contracting state, and only to differences arising out of legal relationships - whether contractual or not - that are considered commercial under national law.

Treaties and conventions
What other treaties and conventions in relation to arbitration is your jurisdiction party to?

India is a party to the Geneva Convention on the Execution of Foreign Arbitral Awards 1927. It is not a signatory to the International Centre for the Settlement of Investment Disputes Convention 1965.

As of November 2015, India had signed 83 bilateral investment treaties and bilateral investment promotion and protection agreements, of which 72 were in force; the remainder are in the process of being enforced. The government is also negotiating treaties with the United States and Canada. India has additionally signed comprehensive economic cooperation agreements, which contain investment protection provisions, with major investment partners such as Japan and Singapore.

UNCITRAL
Has your jurisdiction adopted the UNCITRAL Model Law?

The Arbitration and Conciliation Act is broadly based on the UNCITRAL Model Law and was enacted to consolidate, define and amend the law relation to domestic arbitration, international commercial arbitration and the enforcement of foreign arbitral awards.   

Reform
Are there any impending plans to reform the arbitration laws in your jurisdiction?

On October 23 2015 the president promulgated the Arbitration and Conciliation (Amendment) Ordinance, which amends the Arbitration and Conciliation Act. The legislation entered into force with immediate effect but is subject to approval from Parliament in the coming months. 

Arbitration agreements

Validity
What are the validity requirements for an arbitration agreement?

The arbitration agreement must be in writing.  It may be in the form of an arbitration clause in a contract or in a separate agreement. There is no particular form for an arbitration agreement and the courts will look at the wording to determine whether the parties intended to enter into an arbitration agreement. The agreement need not use the words ‘arbitration’, ‘arbitrator’ or ‘arbitral tribunal’.   

Enforcement of agreements
How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements?

The Indian courts are increasingly adopting a pro-arbitration approach and enforcing valid arbitration agreements. The statement of objects and reasons of the Arbitration and Conciliation Act also recognises the principle of non-intervention by courts in the arbitration process. However, the Indian courts will refuse to enforce an arbitration agreement where the agreement is invalid or the dispute is not arbitrable.   

 

Consolidation
Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?

The Arbitration and Conciliation Act is silent on the power of a tribunal to consolidate separate arbitration proceedings under one or more contracts. However, the Indian courts are unlikely to interfere with a tribunal’s decision to consolidate proceedings with the consent of the parties.  

Choice of law
How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

The Indian courts will recognise and implement the parties’ choice of governing law, unless it is opposed to the public policy of India. Where all parties are Indian, the Supreme Court has restricted such parties from choosing foreign law as the substantive law to resolve their dispute.

In domestic arbitration, if the parties have not designated the substantive law in their agreement, the tribunal will decide the dispute in accordance with Indian law. However, in international commercial arbitration (ie, where one or more parties is non-Indian), the tribunal has the power to apply the rules of law which it considers most appropriate given all circumstances surrounding the dispute.

Separability
Are there any provisions on the separability of arbitration agreements?

The Arbitration and Conciliation Act contains no specific provisions on separability. However, Indian law recognises the doctrine of separability and a valid arbitration clause is separable from the parent contract and constitutes an agreement by itself.

Multiparty agreements
Are multiparty agreements recognised?

The Arbitration and Conciliation Act is silent on multi-party arbitrations. However, the Indian courts have recognised multi-party agreements.    

Arbitral tribunal

Criteria for arbitrators
Are there any restrictions?

The Arbitration and Conciliation Act does not require that arbitrators have any specific background or qualifications. The arbitrators can be of any nationality, unless the agreement stipulates otherwise. The arbitrators must be independent and impartial, and treat all parties equally.

The appointment of an arbitrator can be challenged if the parties raise reasonable doubts as to his independence or impartiality, or if he does not possess the qualifications as agreed between the parties. 

Contractual stipulations
What can be stipulated about the tribunal in the agreement?

The parties are free to agree on a procedure for appointing the tribunal. However, they cannot exclude the requirements that the arbitrators be independent and impartial, and treat all parties equally. 

Default requirements
Are there any default legal requirements as to the selection of a tribunal - for example, concerning the number of arbitrators or their characteristics?

The parties are free to decide on the number of arbitrators, as long as this is not an even number. If the parties fail to specify the number of arbitrators, the tribunal will consist of one arbitrator. When the parties fail to agree on a procedure for appointing a three-member tribunal, each party will nominate one arbitrator and the two party-appointed arbitrators will then appoint the presiding arbitrator. If a party fails to appoint an arbitrator within the stipulated period, the other party can apply to the chief justice of India (in international commercial arbitration) or the chief justice of the relevant high court (in domestic arbitration) seeking appointment of the arbitrator. 

Challenging the appointment of an arbitrator
Can the appointment of an arbitrator be challenged? Can an arbitrator be disqualified? What is the procedure for this?

The appointment of an arbitrator can be challenged if reasonable doubts are raised as to the arbitrator’s independence or impartiality, or if the arbitrator does not possess the qualifications as agreed between the parties.

This challenge may be made only for reasons which the challenging party discovered after the arbitrator's appointment.

The parties are free to agree on a procedure to challenge the appointment of an arbitrator. Unless the arbitrator withdraws or both parties agree to the challenge, the tribunal will decide whether the arbitrator should be disqualified. Local arbitration institutions in India - including the London Court of International Arbitration India and the Indian Council for Arbitration - have also set out procedures for challenging the appointment of an arbitrator.

Jurisdictional objections
How should an objection to jurisdiction be raised?

A party seeking to challenge the existence of an arbitration agreement must raise its objections before the tribunal at the first available opportunity. No objections can be raised once the award has been issued. Lack of arbitrability is considered to be a matter of jurisdiction.  

Replacement of an arbitrator
Why and how can an arbitrator be replaced?

A replacement arbitrator can be appointed where the mandate of an existing arbitrator is terminated. The mandate of an arbitrator ends if:

  • he is unable to perform the required functions;
  • he acts with undue delay;
  • he withdraws from the office; or
  • the parties agree to terminate his mandate.

A replacement arbitrator must be appointed in accordance with the same procedure used to appoint the original arbitrator. 

Powers and obligations
What powers and obligations do arbitrators have?

The Arbitration and Conciliation Act gives the arbitrators broad powers to conduct the proceedings. These include the power to:

  • rule on the existence and validity of the arbitration agreement or on its own jurisdiction;
  • order interim measures;
  • determine the admissibility and weight of the evidence adduced before it;
  • decide the dispute on the merits according to the governing law and terms of the contract;
  • encourage settlement through other mechanisms, including conciliation;
  • determine the costs of the arbitration and their apportionment between the parties; and
  • deliver a reasoned award.

In exercising these powers, arbitrators are obliged to adhere to the principles of natural justice. They must give both parties proper notice of hearing and equal opportunity to present their case. They should not act partially or unfairly, or with particular interest towards the appointing party. Their conclusions should be based on material provided by the parties and not on personal knowledge.

Liability of arbitrators
Are arbitrators immune from liability?

The Arbitration and Conciliation Act does not afford arbitrators immunity from liability. 

Communicating with the tribunal
How do the parties communicate with the tribunal?

The Arbitration and Conciliation Act provides no specific guidance on the manner and method in which the parties must communicate with the tribunal. In practice, all substantive communications are in writing. The parties can agree on the language(s) to be used in the arbitration proceedings. In the absence of such agreement, the tribunal can determine the language(s). 

Reaching decisions
Is unanimous agreement of the tribunal required? If there is disagreement, does the will of the majority suffice? What are the implications of this?

The Arbitration and Conciliation Act does not require unanimous agreement from the tribunal.

Unless otherwise agreed by the parties, any decision of the tribunal can be made by a majority of all its members. If the parties and the tribunal agree, the presiding arbitrator may be authorised to decide questions of procedure.

In case of disagreement, a dissenting arbitrator can issue a separate opinion, but the Arbitration and Conciliation Act prescribes no rules as to the form of such a dissenting opinion.

Arbitrability
Are there any disputes incapable of being referred to arbitration?

Disputes that are non-arbitrable include:

  • disputes relating to rights and liabilities which arise out of criminal offences;
  • matrimonial disputes;
  • guardianship matters;
  • insolvency and winding-up matters;
  • testamentary matters; and
  • tenancy matters. 

Can the arbitrability of a dispute be challenged?

The Arbitration and Conciliation Act includes the principle of non-arbitrability and recognises it as an express ground to set aside an award. In general, civil and commercial disputes can be resolved by arbitration.  

Jurisdiction and competence-competence
Is the principle of competence-competence recognised in your jurisdiction? Can a party to an arbitration ask the courts to determine an issue relating to the tribunal’s jurisdiction and competence?

The principle of competence-competence is recognised in India. The Arbitration and Conciliation Act empowers the tribunal to decide matters pertaining to its own jurisdiction, including any issue relating to the existence and validity of the arbitration agreement.

When a tribunal rules on its own jurisdiction and competence, the party disputing jurisdiction can challenge the award of the tribunal only when it is rendered.

However, an Indian court may rule on the tribunal’s jurisdiction and competence in two situations:

  • Where it is asked to appoint an arbitrator, the court may examine the existence and validity of an arbitration agreement before making such an appointment; and
  • Where a party objects to the court’s jurisdiction in an ongoing matter because of the existence of an arbitration agreement, the court will test the validity of the arbitration agreement and not automatically refer the matter to arbitration. 

Arbitral proceedings

Starting an arbitration proceeding
What is needed to commence arbitration?

Under the Arbitration and Conciliation Act, a party can commence arbitration by issuing a notice in writing to the other party of its intention to refer the dispute to arbitration. Unless otherwise agreed by the parties, arbitration proceedings are deemed to have commenced on the date on which the respondent receives such notice from the claimant.   

Limitation periods
Are there any limitation periods for the commencement of arbitration?

The Limitation Act 1963 applies to all proceedings under the Arbitration and Conciliation Act, just as it applies to proceedings in the Indian courts, except to the extent expressly excluded by the Arbitration and Conciliation Act. Any arbitration proceedings commenced after the limitation period (three years from the date on which the cause of action arose) will be time barred. 

Procedural rules
Are there any procedural rules that arbitrators must follow?

The parties can agree on the procedure for conducting the arbitration proceedings. If no such procedure is agreed by the parties, the tribunal is authorised to conduct the proceedings in such manner as it considers appropriate. The tribunal is expressly exempt from applying the provisions of the Civil Procedure Code 1908 and the Evidence Act 1872. If, under the arbitration agreement, the arbitration is to be administered by an arbitration institution, the rules of that institution become a part of the arbitration clause by implication.

The Arbitration and Conciliation (Amendment) Ordinance requires the tribunal to, as far as possible, hold oral hearings for the presentation of evidence or for oral argument on a day-to-day basis, and not grant adjournments unless sufficient cause is provided. It further empowers the tribunal to impose exemplary costs on the party seeking frivolous adjournments.   

Dissenting arbitrators
Are dissenting opinions permitted under the law of your jurisdiction?

Dissenting opinions are permitted under the Arbitration and Conciliation Act. The dissenting arbitrators have the option to prepare a separate award or to give their opinion in the same document which contains the award of the majority members of the tribunal. However, this dissenting opinion or award does not form part of the majority decision and is not enforceable.   

Judicial assistance
Can local courts intervene in proceedings?

Local courts can intervene in domestic arbitration proceedings. This includes the power to issue interim orders and appoint arbitrators. 

Can the local courts assist in choosing arbitrators?

Courts can also assist in selecting arbitrators if the parties are unable to agree on the appointment of a sole arbitrator or if the two party-appointed arbitrators fail to appoint a chairperson. 

What is the applicable law (and prevailing practice) where a respondent fails to participate in an arbitration? Can the courts compel parties to arbitrate? Can they issue subpoenas to third parties?

If a respondent fails to participate in arbitration without sufficient cause, the tribunal may proceed ex parte.

While arbitrators cannot compel third parties to appear before them, the tribunal or a party, with the tribunal’s approval, may apply to the court for assistance in taking evidence. The court may make an order requiring third parties to provide evidence directly to the tribunal. If a person fails to attend in accordance with such order of the court, it is subject to the same penalties and punishments as it may have incurred during court proceedings.

Third parties
In what instances can third parties be bound by an arbitration agreement or award?

The Arbitration and Conciliation Act grants no powers to a tribunal to enjoin a third party to pending arbitration proceedings. Non-signatories to the arbitration agreement can be bound to the arbitration agreement under the ‘groups of companies’ doctrine where a clear intent to bind such non-signatories can be established. 

Default language and seat
Unless agreed by the parties, what is the default language and location for arbitrations?

The parties can agree on the language(s) and location to be used in the arbitration proceedings. In the absence of such agreement, the tribunal has the discretion to determine the language(s) and location.   

Gathering evidence
How is evidence obtained by the tribunal?

The parties are free to agree on the rules of gathering and submitting evidence. If the parties do not agree on these matters, the tribunal has the discretion to determine how evidence may be gathered and submitted to it. The tribunal is required to observe the fundamental principles of natural justice when considering evidence.  

What kinds of evidence are acceptable?

The tribunal may take both documentary and oral evidence on record. The courts can assist the tribunal in taking evidence if such assistance is sought either by the tribunal or by one of the parties with prior approval of the tribunal. 

Confidentiality
Is confidentiality ensured?

The Arbitration and Conciliation Act does not include specific provisions on the confidentiality of arbitration proceedings. As a result, there is no express obligation to treat an arbitration agreement, any proceedings arising therefrom or the award as confidential. Parties can address the issue of confidentiality in the arbitration agreement or by separate agreement. 

Can information in arbitral proceedings be disclosed in subsequent proceedings?

Section 76 of the act provides for confidentiality in conciliation proceedings. The Supreme Court has found that the duty of confidentiality is implied in mediation proceedings.

Ethical codes
What ethical codes and other professional standards, if any, apply to counsel and arbitrators conducting proceedings in your jurisdiction?

The Arbitration and Conciliation Act provides that arbitrators should be independent and impartial, treat each party equally and give them equal opportunity to present their case.

The Arbitration and Conciliation (Amendment) Ordinance has inserted three schedules dealing with arbitrator independence and impartiality. A prospective arbitrator must now disclose in writing (in the form set out in the Sixth Schedule):

the existence of any relationships which would give rise to justifiable doubts about his or her independence and imparity; and
any circumstances that would affect the arbitrator’s ability to complete the arbitration within 12 months.

In line with the IBA Guidelines on Conflicts of Interest in International Arbitration, the Fifth Schedule lists the various grounds which will help to determe whether a circumstance gives rise to justifiable doubts as to the independence or impartiality of an arbitrator.

Also following the IBA Guidelines, the Seventh Schedule lists a number of situations which would render the prospective arbitrator ineligible for appointment, except where the parties have agreed to waive the applicability of this provision. 

Costs

Estimation & allocation
How are the costs of arbitration proceedings estimated and allocated?

Subject to any agreement between the parties, the costs of arbitration are fixed by the tribunal. In doing so, the tribunal is to identify:

  • the party that is entitled to costs;
  • the party that will pay the costs;
  • the amount of costs;
  • the method of determining this amount; and
  • the manner in which costs are to be paid.

The Arbitration and Conciliation Act defines ‘costs’ as:

  • reasonable sums relating to the fees and expenses of the arbitrators and witnesses;
  • legal fees and expenses;
  • fees of the arbitration institution; and
  • any other expense incurred in connection with the arbitration proceedings.

The Arbitration and Conciliation (Amendment) Ordinance introduces a new regime for costs, with a general rule that the unsuccessful party will be ordered to pay costs to the successful party. However, the tribunal may depart from this rule and apportion costs differently in view of the conduct of the parties. 

Security for costs
Can the national court or tribunal order security for costs under the law in your jurisdiction?

The Arbitration and Conciliation Act empowers both a court and a tribunal to order security for costs as an interim measure.  

The award

Requirements
What legal requirements are there for recognition of an award? Must reasons be given for the award? Does the award need to be reviewed by any other body?

The award must be in writing and be signed by all members of the tribunal or signed by the majority with reasons for any omitted signatures. The Arbitration and Conciliation Act requires the award to set out the reasons on which it is based, unless the parties have agreed that no reasons are to be given. The award should state the date and place of the arbitration, and a signed copy must be delivered to each party. 

Timeframe for delivery
Are there any time limits on delivery of the award?

In accordance with the Arbitration and Conciliation (Amendment) Ordinance, the tribunal must render awards within 12 months of the date that it enters the reference. This period can be extended by up to six months if all of the parties agree. If the award is not made within 12 months or within the mutually extended period, the tribunal’s mandate would be terminated, unless the period has been extended by the court.  

Remedies
Does the law impose limits on the available remedies? Are some remedies not enforceable by the court?

The Arbitration and Conciliation Act imposes no specific limitations on the remedies available through arbitration. The limitations are thus the same as those applicable in any Indian court proceedings. The tribunal can order specific performance and award damages, injunctions, declarations, costs and interest. Under Indian law, exemplary or punitive damages for breach of contract are not available.

Indian courts can issue interim measures pending constitution of the tribunal. This power continues through the proceedings until the declaration of the award.

What interim measures are available? Will local courts issue interim measures pending constitution of the tribunal?

Both courts and tribunals can issue interim measures, but courts have wider powers to grant interim protections. The parties can, by agreement, restrict the power of the tribunal to grant interim measures.

Available interim measures include:

  • orders for security for costs;
  • injunctions;
  • appointment of a receiver;
  • orders for preservation, custody, sale and protection of goods; and
  • any other interim measure that may be just and convenient.

The Supreme Court has clarified that Indian courts will not grant interim measures of protection in relation to arbitrations seated outside India, irrespective of any agreement between the parties.

Interest
Can interest be awarded?

Subject to any agreement between the parties, the tribunal has discretion on matters relating to the award of interest. It may award interest at such rate as it deems reasonable on the whole or part of the amount, for the whole or part of the period between the date on which the cause of action arose and the date of the award.    

At what rate?

The Arbitration and Conciliation (Amendment) Ordinance provides that an award will carry interest at the rate of 2% higher than the existing rate of interest prevalent on the date of award.  

Finality
Is the award final and binding?

Under the Arbitration and Conciliation Act, the award is final and binding on the parties (subject to any right to challenge the award).  

What if there are any mistakes?

The act allows a tribunal to:

  • correct any computation, clerical, typographical or similar error;
  • provide its interpretation of a specific point or part of an award; and
  • make an additional award as to claims omitted from the original award.

Can the parties exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?

The right to challenge an award is a statutory right and thus cannot be waived or taken away by an agreement between the parties. 

Appeal
On what grounds can parties appeal an award?

The Arbitration and Conciliation Act does not provide for appeals to court, but does allow for challenges to the award. The grounds for challenging domestic awards under Indian law are largely based on Article 34 of the UNCITRAL Model Law. A challenging party can raise the following grounds:

  • lack of capacity of the parties to conclude an arbitration agreement;
  • lack of a valid arbitration agreement;
  • lack of proper notice of appointment of an arbitrator or of the arbitration proceedings, or inability of a party to present its case;
  • lack of impartiality or independence of the arbitrator;
  • composition of the tribunal or conduct of the proceedings contrary to the effective agreement of the parties;
  • non-arbitrability of the subject matter of the dispute; or
  • conflict with the public policy of India. 

What is the procedure for challenging awards?

For domestic awards, an application to challenge the award must be filed in court within three months of receipt of the award. In certain circumstances, the court may consider an application for setting aside within a further period of 30 days if it is satisfied that there was sufficient cause for such delay. If the court rejects the application for challenge, the award is enforceable as a decree of the court.  The unsuccessful party has only one right to appeal an order setting aside or refusing to set aside an award, and no second appeal can be made against an appellate order. However, there is a constitutional right to file an appeal before the Supreme Court of India (a ‘special leave petition’). The Supreme Court will exercise its discretion sparingly and consider such an appeal only if there is a gross error of law or an important issue of law is involved.

The parties cannot enter into an agreement to waive their right to challenge an arbitral award.

Enforcement
What steps can be taken to enforce the award if there is a failure to comply?

The Arbitration and Conciliation Act states that an award may be enforced as if it were an Indian court decree.    

Can awards be enforced in local courts?

A domestic award does not require separate enforcement application proceedings. On the other hand, a foreign award (ie, an award in arbitration seated outside India) is enforced through an enforcement process in any court within the territorial limits where the defendant resides or has its business or where its assets are located. 

How enforceable is the award internationally?

India is a party to the New York Convention. The enforceability of an award issued by a tribunal seated in India in an international jurisdiction will therefore depend on whether that jurisdiction has signed the New York Convention and its reservations at the time of signature. 

To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?

The defence of sovereign immunity is not available to state entities at the enforcement stage where those state entities are engaged in commercial activities.   

Are there any other bases on which an award may be challenged, and if so, by what?

Section 48 of the Arbitration and Conciliation Act lists the grounds on which the enforcement of a New York Convention award may be refused and is based on Article V of the New York Convention. 

How enforceable are foreign arbitral awards in your jurisdiction?

Awards issued in most of the major arbitration centres of the world are enforceable in India. Part II of the Arbitration and Conciliation Act, which governs enforcement of foreign awards in India, applies only to awards issued in jurisdictions notified by the Indian government as jurisdictions in which the New York Convention applies. The government has notified all key centres of international arbitration, including France, the United Kingdom, China, Singapore, Sweden, Switzerland and the United States.

A party enforcing an award issued in an arbitration seated outside India under the New York Convention must apply to court and produce the following documents:

  • the original award or an authenticated copy;
  • the original arbitration agreement or a duly certified copy;
  • such evidence as may be necessary to prove that the award is a foreign award; and
  • translations of these documents, if necessary.

Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?

Indian courts will not enforce a foreign award that has been set aside by the court at the place of arbitration. 

Third-party funding

Rules and restrictions
Are there rules or restrictions on third-party funders?

The Arbitration and Conciliation Act is silent on third-party funding. There are no rules or restrictions in India dealing with third-party funding of arbitrations. 

Class-action or group arbitration

Concept
Is there a concept in your jurisdiction providing for class-action arbitration or group arbitration? If so, are there any limitations to the arbitrability of such claims or requirements that must be met before such claims may be arbitrated?

The Arbitration and Conciliation Act is silent on group arbitration. 

Hot topics

Emerging trends
Are there any hot topics or trends emerging in arbitration in your jurisdiction?

With respect to international commercial arbitration, since its September 2012 decision in Bharat Aluminium v Kaiser Aluminium Technical Services (popularly known as the BALCO decision), the Supreme Court of India minimised the supervisory role of the courts in the arbitration process. In a series of judgments the Supreme Court sought to reform its much-criticised tendency to interfere in the international arbitration process.

In August 2014 the Law Commission of India proposed a set of wide-ranging reforms to the Arbitration and Conciliation Act. It sought to address the significant challenges that “plague the present regime of arbitration in India”.

Relying on the work of the Law Commission, in October 2015 the government introduced the Arbitration and Conciliation (Amendment) Ordinance. This ordinance amends the Arbitration and Conciliation Act and incorporates some of the key recommendations of the Law Commission. The 2015 ordinance curtails the public policy grounds to challenge awards and clarifies other issues relating to the enforcement of foreign awards. This ordinance has been promulgated alongside the Commercial Courts Ordinance 2015, which stipulates that arbitration-related proceedings can be heard only by specially designated commercial courts. 

Through the joint efforts of the judiciary and the legislature, India is slowly reversing its reputation of being excessively interventionist towards international arbitration. This is consistent with the government’s avowed objective to develop India into a major international arbitration destination.

As regards investment treaty arbitration, India has been at the receiving end of a number of claims. In November 2011 India was held liable under the Australia-India bilateral investment treaty (BIT) in the first publicly known investment treaty award under an Indian BIT. The tribunal, seated in London, held that the Indian courts’ failure to resolve the claimant’s jurisdictional claim over a period of nine years amounted to a breach of India’s obligation to provide the claimant (Australian mining company White Industries) with an effective means of asserting claims and enforcing rights. Since this award, a number of international companies have initiated investment claims against India. In response, the government has grown increasing skeptical of investment treaty arbitration, as evidenced by the draft revised model BIT. The draft restricts the protections offered to foreign investors and seeks to prevent repeats of previous claims. The government is revising this draft further based on comments and criticisms.