Businesses fear collapse of Indian investment treaty could spike deals

Monday, 17 April 2017

India has scrapped a key protection for foreign investors, in a move which businesses fear will stifle international projects involving the fast-developing nation.

Dozens of bilateral investment deals have been signed over the past 30 years that allow companies to go to an international dispute resolution system if they believe they have been mistreated – for instance, if their assets are wrongly expropriated, or they claim to be discriminated against by the legal system.

India has quietly withdrawn from the system following a series of embarrassments including a long-running tax row with Vodafone, raising fears over the security of foreign investments.