Calvo's Indian Grandchildren: An Analysis of the Local Remedies Rule under India Model BIT

Abstract

This paper reviews the scope and the legal nature of “conditions precedent” requirements set out under India’s Model BIT. The author traces the approach of Indian courts towards clauses requiring satisfaction of pre-conditions prior to the commencement of arbitration. In particular, the author reviews Indian decisions to assess whether such provisions have been characterized as mandatory or optional. The author also surveys the existing international investment law jurisprudence to analyze the interpretations accorded to such clauses by investment treaty tribunals. Finally, the paper discusses and offers an Indian perspective on the consequences and the potential issues in case of non-compliances of such provisions. Although India’s Model BIT has been subject to much academic comment, this paper seeks to contribute to the existing discussion by examining Art. 15.2 of the Model BIT which requires submission of disputes domestically for at least period of five years.