India to serve as S Asia’s arbitration hub

New Delhi: India is all set to sign on Friday the all-important agreement with The Hague-based Permanent Court of Arbitration (PCA) for starting its regional facility in the country, that could create a credible alternative dispute redressal forum for South Asian countries.

Creation of a proper arbitration forum acceptable to the international community would create an investmentfriendly atmosphere as it would instil confidence in MNCs, which till now had some hesitation on this score in the absence of a proper alternative dispute redressal (ADR) forum.

Law minister H R Bhardwaj is in The Hague to sign the agreement with PCA on September 19, more than four years after the then PCA secretary-general, Tjaco T van den Hout, made a proposal for setting up of the regional facility of PCA in India. The Union Cabinet cleared the proposal on September 4.

The offer was made by PCA in recognition of the contributions of India to the cause of peaceful settlement of disputes in strict adherence to international law.

“Additionally, the offer seeks to give expression to the idea that parties in South Asia will be more willing to engage in arbitration or other mechanisms of ADR in an environment that is culturally and linguistically closer and, hence, more comfortable to them,” said senior advocate A K Ganguly, who was the singular force in driving home to the government the advantages of a regional facility of PCA in India. This means, if any large contract between Indian PSUs and MNCs goes into arbitration over a dispute, they do not have to rush to The Hague or London or to other western countries for international arbitration.

The regional facility of PCA, expected to be set up by the year-end, would suffice, Ganguly said. In addition, it would also make India the arbitration destination for disputes arising from South Asian countries, he added.

With Thanks from the Times of India
Source:- The Times of India 18 Sep. 08 P.17 New DelhiFor any query:- legalpoint@aol.in