Government to amend investment treaty to woo global players
The Indian government is planning to amend its model bilateral investment treaty to allow international arbitration after one year of exhausting local remedies, down from the current five-year requirement. This move aims to attract more global investors by addressing long-standing concerns regarding dispute resolution.
Why it matters
Revising investment treaties is a critical step for India to improve its ease of doing business and encourage foreign direct investment.
NEW DELHI: Seeking to address a long-pending grouse of overseas investors, govt is all set to amend the model bilateral investment treaty (BIT) to allow for international arbitration one year after exhaustion of local remedies, instead of the current five-year clause that was brought in, amid a spate of challenges by global investors.A cabinet note has been moved by the finance ministry to amend the model BIT put in place a decade ago and it has also proposed to expand the definition of investment from enterprise-based to asset-based, which will include shares and equity instruments that are maintained for five years or more, persons familiar with the discussions told TOI.The Centre is looking to provide certain carveouts, which can include aspects, such as subsidies, local govt measures and compulsory licensing used to waive patent rights in cases of public health emergency and other situations.
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