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Remarks on Indian Arbitration Law - WAMR 2006 Vol. 17, No. 7

Author(s): 
Sunil Reddy Bokka
Page Count: 
12 pages
Media Description: 
PDF from World Arbitration and Mediation Report (WAMR) 2006 Vol. 17, No. 7
Published: 
July, 2006
Jurisdictions: 
India
Practice Areas: 
Arbitrators and Arbitral Tribunals,
Commercial Disputes,
Court Decisions,
Sources of Arbitration Law,
Geneva Protocol on Arbitration Clauses,
New York Convention,
UNCITRAL Model Law
Author Detail: 

 

Sunil Reddy Bokka, LLM, the Dickinson School of Law of the Pennsylvania State University. Mr. Bokka lives in Peoria, Illinois.

PDF142.85 KB

$40.00
Description: 

 

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National Report
Remarks on Indian Arbitration Law
By Sunil Reddy Bokka∗
Introduction
In the past, foreign investment in India faced typical Asian
problems: political risk, graft and corruption, the need for several licenses
and permissions to do business, tariff and non-tariff barriers, labor
problems and no exit policy, very poor infrastructure, a barrage of laws
(several of them with evident socialist overtones), and an overburdened
judiciary, with millions of cases pending. Investment was thus diverted to
neighboring countries despite several inherent advantages that India
enjoyed: a common-law-based legal system, the use of English as the
business language, a ready-made market, a cheap and skilled labor force, a
rich natural resources base, and the rule of law. A series of ambitious
economic reforms aimed at deregulating the economy and stimulating
foreign investment has moved India into the forefront of the rapidly
growing Asia Pacific Region and unleashed the latent strength of a
complex and rapidly changing nation.
One of the primary grievances of the foreign investor had always
been the delay, cost, and uncertainty involved litigation in the ordinary
Indian courts. Cases were not finally disposed of for at least ten years
from the date of the commencement. The alternative was arbitration.
There are no bilateral conventions between India and any other country
concerning arbitration. India has acceded to the following conventions:
The Geneva Protocol on Arbitration Clauses of 1923
The Geneva Convention on the Execution of Foreign Arbitral
Awards, 1927 and
The New York Convention of 1958 on the Recognition and
Enforcement of Foreign Arbitral Awards. (India became a party to
the 1958 Convention on the June 10, 1958 and ratified the
Convention on July 13, 1961.)
The government did not make use of the strengths it had to market
the nation. Apparent flaws in the arbitration laws and difficulty in
enforcing foreign awards added to the confusion. An Arbitration
Ordinance was promulgated in mid-1995, but political change at the
national level delayed the process of converting the ordinance into a
statute.
On January 25, 1996, India adopted a new arbitration law based on
the UNCITRAL Model Law on International Commercial Arbitration to
boost foreign investment. The Arbitration and Conciliation Ordinance of