Chief Justice of India Dipak Misra on Saturday said that India will have a pivotal place in the world of arbitration in future. Addressing a conference organised by the Mumbai Centre for International Arbitration on the ‘Changing Landscape of Arbitration in India’, CJI Misra said that institutional arbitration as an alternative dispute redressal mechanism is here to stay.
“The idea of institutional arbitration has come to stay in India… An award passed by an arbitrator cannot be a paper tiger. Enforcement is the cornerstone of any result that comes through arbitration – institutional or in court. Indian courts are not scared of accepting foreign jurisdiction if the parties agree by their agreements,” CJI Misra said.
About the role of law in the economy, he added, “I always say that economy is never static. Economy and law move together. The Arbitration and Conciliation (Amendment) Act, 2015, was made to eradicate certain difficulties. It has connected the law and economy in three ways by emphasising on speedy disposal, cost-effective arbitration and objectivity and impartiality of the arbitrator. These are the safeguards in the Act,” he said. He added that arbitration centres of various courts, including the Delhi High Court Arbitration Centre, are facilitating the process. “India is growing, our economy is growing. We appoint today the highest court and centres are nominated… this institutional arbitration is more effective than ad hoc ones. We have to see how to improve this arbitration,” he said.
Union Minister of Commerce and Industry Suresh Prabhu, who had sent a pre-recorded video message for the conference, emphasised on the need to unburden courts. “There are several business disputes that should go into alternate dispute redressal mechanisms. They are going to courts as civil disputes, which are adding to the burden on the judiciary. An alternate system, which is expeditious, is needed. Currently, many are choosing to conduct arbitration abroad. We need good institutions in India for arbitration,” Prabhu said.
Supreme Court Judge Justice A K Sikri said the improvement of rankings of India from 130th to 100 in the World Bank’s ranking of countries for ease of doing business was a “big achievement”. “These 30 steps in one stroke is a big achievement. Among the reasons given by the World Bank for this is that we have made significant statutory changes in the arbitration law bringing it in tune with international standards. Going by the experiences and several difficulties, which were faced earlier, I would say that they have been overcome by the 2015 amendments,” he said. He added that some steps are required to ensure India becomes the hub of international arbitration, including appointment of judges well-equipped in commercial laws, effective role by arbitrators, and properly worded arbitration clauses.
Justice Sikri added that in a conversation with the Niti Ayog CEO, he was told that India can go from 100th rank to 70 or even higher if one thing is done – enforcement of contracts by the judiciary. He added that there has been a paradigm shift in the judiciary, with an approach of minimal intervention in awards but some problems of delay continue to remain and needed to be taken care of.