The relatively limited visibility of the India International Arbitration Centre (IIAC) is symptomatic of a broader deficit of confidence in institutional arbitration within the country, former Supreme Court judge Justice L Nageswara Rao has said.
Justice Rao made the observations while participating in a panel discussion organised by the Singapore International Arbitration Centre (SIAC) during Singapore Convention Week. The discussion was moderated by White & Case Partner Aditya Singh and centred on the challenges confronting India’s institutional arbitration framework.
The issue arose against the backdrop of a recent Parliamentary Standing Committee report examining the functioning of the IIAC. The Committee had noted that the Centre was conceived as an institution capable of competing with established international arbitral bodies such as SIAC, the London Court of International Arbitration and the Hong Kong International Arbitration Centre, but flagged concerns over its limited visibility and usage.
Justice Rao, however, suggested that the challenge extended beyond institutional visibility. The more fundamental task, he said, was to persuade members of the legal and corporate community to repose greater confidence in domestic arbitral institutions and move away from an entrenched preference for ad hoc arbitration.
According to him, law firms and general counsel have a significant role to play in strengthening institutional arbitration by encouraging parties to choose established arbitral centres rather than relying exclusively on ad hoc mechanisms. Without such confidence and participation from the principal users of the arbitral ecosystem, institutional growth would remain difficult.
The panel also featured former Supreme Court judge Justice S Ravindra Bhat, former Attorney General for England and Wales Lord Peter Goldsmith KC, Senior Advocate Rajshekhar Rao and SIAC Director and Head of South Asia Shwetha Bidhuri.
Bidhuri cautioned against expecting a relatively young institution to immediately attain the stature of arbitral centres that have spent decades cultivating credibility. She emphasised that institutional legitimacy cannot be created merely through the adoption of procedural rules or the formulation of fee schedules. The quality of case administration, consistency in implementation and the institutional mechanisms for scrutiny of awards were equally critical to building long-term confidence, she said.
The discussion also examined concerns regarding judicial intervention in arbitration. While the Parliamentary Committee had recommended clearer parameters regarding the scope and limits of court interference, Justice Rao took the view that India already possesses a reasonably developed body of arbitral jurisprudence. The more pressing concern, he suggested, was the inconsistent application of settled legal principles.
He also criticised the manner in which institutional arbitration had been developed in India, observing that merely providing infrastructure and financial support to an institution and expecting it to compete with globally established centres was insufficient. Particular concern was expressed over delays arising at the stages of challenge and enforcement of arbitral awards.
Justice Rao maintained that the solution did not necessarily lie in creating additional tribunals or regulatory layers, but in ensuring a more effective and consistent application of the existing legal framework.
Lord Goldsmith, meanwhile, noted that India had taken several steps supportive of arbitration but expressed reservations over attempts to reduce the use of arbitration in large public contracts. Such measures, he cautioned, could send conflicting signals to international commercial parties regarding the State’s commitment to arbitration as a dispute-resolution mechanism.
The panel further considered the possible implications of the Supreme Court’s decision in Gayatri Balasamy, particularly with respect to the limited power of courts to modify arbitral awards. Justice Ravindra Bhat observed that the consequences of the ruling would have to be assessed beyond the Supreme Court and High Courts, especially as challenges to arbitral awards and enforcement proceedings are dealt with across a vast network of courts throughout the country. The manner in which the decision is applied at different judicial levels, he indicated, remains an area that will require close observation.
The discussion ultimately underscored a recurring concern within India’s arbitration landscape: legislative reform and institutional infrastructure, though important, may not by themselves be sufficient to transform India into a credible global arbitration destination. Building that ecosystem, the panellists indicated, will depend equally upon institutional competence, judicial consistency, efficient enforcement and, above all, the confidence of those who choose arbitration as a means of resolving commercial disputes.
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