At the Delhi Arbitration Weekend’s evening reception, Saraf & Partners Founder and Managing Partner Mohit Saraf termed the remarks made by Senior Advocate Harish Salve on the state of arbitration in India as "depressing".

Referring to recent remarks disparaging retired judges as arbitrators, Saraf said:

“Two days back, one of the very senior members of Bar made a very, I would say, depressing statement about retired judges being arbitrators, and that is very widely communicated and circulated.”

He defended the legitimacy of arbitral diversity.

“No two law firms give the same work product; no two lawyers give the same work product,, and therefore no arbitrator will give the same work product...To generalise is not a great thing to do.”

Salve had recently commented,

“The moment I see a tribunal presided over by a retired judge, I lose faith in it...The problem in India is not the law. The problem in India...is because Indian judges are over-interventionists.”

The panel also featured former Supreme Court Justice Indu Malhotra, Director General of the London Court of International Arbitration (LCIA) Kevin Nash and WilmerHale Partner Steven Finizio. The discussion revolved around India’s continued preference for ad hoc arbitration.

Justice Malhotra stressed that courts must refrain from modifying arbitral awards. Referring to Justice KV Viswanathan's dissenting view in the judgment against modification of arbitral awards, she said,

“I am actually a supporter of the dissenting view (of the Gayatri Balasamy judgment)…normally I don’t think one should be interfering with the award."

The former judge defended India’s record on enforcement, countering the perception that Indian courts are hostile to arbitration.

“There are very, very few awards which have been set aside and they are for compelling reasons. It is on the basis of evidence…Whether domestic or international, India has certainly been a pro-arbitration jurisdiction.”

However, she cautioned against the growing trend of inflated claims.

“Companies make such humongous claims without producing sufficient evidence — sometimes six times the contract value — and arbitrators cannot award such amounts unless substantiated.”

She also reminded the audience that India’s arbitration landscape required both flexibility and choice.

“India has a vast and diverse population with equally diverse disputes. It is important that both institutional and ad-hoc arbitration mechanisms remain available, so that parties can choose the process that best suits the nature of their disputes.”

Nash reflected on how the debate has shifted in recent years.

“The ad hoc - institutional debate, I think, is getting much better. It’s different than it was 10 years ago or 15 years ago in India. We used to have metrics that would suggest that maybe 90% of the arbitrations being conducted in India, particularly domestic arbitrations, were ad hoc. But I think that the advantages of institutional arbitration are clear.”

He underlined his consistent view that institutional arbitration offers greater efficiency.

“So I will always take the position that all else equal, institutional arbitration is faster and more cost effective than ad hoc arbitration.”

He acknowledged, however, that ad hoc can work when conditions are right.

“Ad hoc arbitration works great when everyone is getting along. If you have sophisticated counsel and eminent tribunal, there is nothing wrong with ad hoc arbitration.”

He also rejected the notion that institutional proceedings are necessarily more expensive.

“Institutional fees are three or four percent of the overall cost of an arbitration. Duration drives expense,” he explained, emphasising that institutional frameworks are designed to cut down delays.

Finizio offered a different perspective. While recognising the efficiency of institutions, he warned against legislating mandatory institutional arbitration.

“The solution has to be based on choice...You can’t mandate institutional arbitration; it raises serious questions.”

He emphasised the centrality of party choice in maintaining credibility.

“Party autonomy is at the heart of arbitration, if you take that away from parties, you risk undermining legitimacy.”

Finizio also cautioned that heavy government involvement could backfire.

“The more the government steps in to create institutions, you put a taint over party choice.”