India closer than ever to becoming an international arbitration hub: Former UK Attorney General Lord Peter Goldsmith

Former Attorney General for England and Wales and for Northern Ireland Lord Peter Goldsmith, PC KC on Thursday expressed his belief that India is now closer than ever to realizing its goal of becoming a global hub for arbitration..Speaking at the inaugural session of Delhi Arbitration Weekend organized by the Delhi International Arbitration Centre (DIAC), he shared insights on the steps that India can take to establish itself as a reliable destination for international commercial dispute resolution, regardless of whether there is an Indian link to the dispute."While India's ambition to be a leading hub for international arbitration has been clear for a number of years, from my perspective as an international arbitration practitioner, India is closer than ever to achieving this goal. Indian arbitrations are being increasingly seated in India and this will no doubt continue. But this evening, I want to consider how India can ensure that it is viewed as a viable arbitration seat for international commercial disputes, whether there is an Indian connection or not," he said..Lord Goldsmith, who is the Chair of European and Asian Litigation at Debevoise & Plimpton LLP, highlighted the country's progress in becoming a major player on the global stage. As an example, he noted that India has overtaken the United Kingdom to become the world's fifth-largest economy. In addition, he remarked that India is set to become the world's most populous country by April of this year, which will present both jubilation and challenges, especially in the legal field.This rise, according to Lord Goldsmith, will result in an increase of demand from the international business community to have access to an efficient, reliable and final way of resolving disputes related to India. However, given that the Indian domestic court system is heavily occupied, he suggested meeting this demand through alternative methods of dispute resolution..To ensure that India is viewed as a viable seat for international commercial disputes, Lord Goldsmith proposed working on further solidifying the foundations it already has, and on building on five key areas..1. A highly skilled and strong barDrawing from personal experience of working alongside and against Indian lawyers, he attested to their capacity as excellent team players and worthy opponents. .2. Pro-arbitration judicial decisionsLord Goldsmith highlighted that the judiciary is actively providing critical support for the arbitral process, with both the Supreme Court and the High Courts addressing various arbitration-related issues over the past five years, including matters such as determining the seat of arbitration in cases where only the venue is specified..3. Legislative support for arbitrationTo highlight the legislative support, he mentioned the 2019 and 2021 amendments to the Arbitration and Conciliation Act, which were aimed at promoting institutional arbitration in India and at promoting India as an international hub for arbitration. He also cited the establishment of DIAC as an example..4. The common law systemHe said that India's willingness to look outward and be flexible to changes of law leaves it in a strong position. Further, even as India benefits from Common Law, it also takes into account special challenges and traditions of the country..To build on this foundation, according to Lord Goldsmith, India must look to other leading international arbitration seats like London, Paris, Singapore and Hong Kong, and assess what led to their success."India can then consider those aspects and how they can be incorporated in the context of its own ecosystem and arbitral landscape," he added..He singled out five areas that India will need to work on to ensure that it is on level footing with leading arbitration hubs:.Recognition of party autonomyStrong homegrown arbitral institutionsIndependence and impartiality of arbitratorsAdoption of best international practicesInnovation.Notably, Lord Goldsmith also addressed the role of the Arbitration Council after the 2019 amendment to the Arbitration and Conciliation Act, calling its mandate "broad" and potentially negatively impactful to India's goal.The Arbitration Council is an independent body appointed by the Central government which is responsible for framing policy, guidelines, creating arbitral institutions and accrediting arbitrators."I can't think of an example in an arbitration-friendly jurisdiction where such a body is also charged with regulating it. It seems to me that this is because the business community puts considerable weight on the autonomy of the arbitral process, which is significantly eroded when a government regulator becomes involved," he stated.As a result, there exists a real risk of the Council's mandate cutting into party autonomy and controlling the arbitral process, leading to businesses removing India from their lists as a potential arbitration seat, Lord Goldsmith added. He said that while this initiative was not arbitration-friendly, it was understandable in the context of the Indian landscape, and that careful consideration will be required to determine how the Council could help in supporting India's pro-arbitration ambitions.He stressed on the need for the Arbitration Council's regulations to take into account the views of potential stakeholders to encourage the international community to consider India as a seat for arbitration..Arbitration space must shed tag of being old boys' club; provide equal opportunity to men, women and them: CJI DY Chandrachud