Over the last decade, the Indian legal industry has witnessed a number of developments in the arbitration arena that have attracted the attention of lawyers and nonlawyers alike. As a result of the liberalization of many sectors, and the significant increase in foreign direct investment, this has important implications for foreign companies investing in India. A 2011 study on arbitration in India by Ernst & Young found that 74 percent of respondents (mainly large corporate and leading law firms) said that an arbitration clause was an essential part of their legal contracts.
Until recently, most Indian arbitration had been ad hoc, and a large number of cases were plagued by inexperienced arbitrators, lack of predictability in costs and fees, and a general absence of case management by the arbitrators. In recognition of this, the government and private institutions have seized the opportunity and increased efforts to promote arbitration and provide viable alternatives. The government hopes to promote India as an international arbitration hub along the lines of Singapore, and the institutions see an opportunity to grow their business.
