Arbitration rising: India’s path to Asia’s top seat

India has made real progress in arbitration in the last decade. It now has stronger laws, more supportive courts and new institutions like the Gujarat High Court Arbitration Centre (GHAC) joining the landscape.

At the same time, India has not yet become Asia’s first choice arbitration hub, or even the default “safe seat” for its own companies. This tension was clearly expressed by Chief Justice of India Surya Kant at the GHAC foundation event in Ahmedabad, where he observed that India’s arbitration framework has “matured considerably”, but gaps of trust and underuse of institutions still hold the system back.

India’s Arbitration and Conciliation Act, 1996 has been reshaped through major amendments since 2015. These reforms were designed to make India more arbitration-friendly by:

• Reducing unnecessary court interference in arbitral proceedings.

• Introducing strict timelines for making awards, usually within 12 months.

• Strengthening the neutrality and independence of arbitrator appointments.

Courts, especially the Supreme Court, have reinforced this legislative push. They increasingly respect party autonomy, interpret “public policy” narrowly when asked to set aside awards and show greater willingness to enforce foreign awards. These developments make India’s legal framework look modern and aligned with international best practices.

Despite this, many parties in cross-border transactions still prefer to seat their arbitration in jurisdictions like Singapore or London. On paper, India offers a strong framework. In practice, users remain cautious because of perceived delays, uncertainty and uneven experiences across different courts and forums.

The big problem with the way things are done now is that people are still using ad hoc arbitration a lot. When people in India have a dispute, they usually make up their rules and process and they do not get much help or supervision from institutions. At first, ad hoc arbitration might seem like a more flexible option, but it has a lot of risks, such as not having clear rules or timelines, which can cause delays and make the process slower.

On the other hand, institutional arbitration centres, like the Singapore International Arbitration Centre (SIAC) or ICC in Paris, have fixed rules and experienced people to help with the process. They also have a list of arbitrators to choose from and they can handle emergency situations. These centres can make the process more predictable and disciplined.

CJI Surya Kant said that institutional arbitration is not used as much as it should be in India. India has its institutions, but people do not use them very much. People often wonder if these centres are really worth using and if they can really make the process faster, fairer and more efficient. Some people in India like ad hoc arbitration because they want to be in control, but when it comes to international disputes, where time and certainty are very important, this way of doing things often does not work. Unless Indian institutions can show that they are better than ad hoc processes by providing data on how long cases take, how well they enforce outcomes and how happy users are, people will not trust them very much.

The best award is only as good as how it is enforced. This is a worry for people who use Indian arbitration. People who lose in arbitration often try to challenge the award in many ways and use different tactics to delay the process. They might ask for time, present new evidence, or interpret public policy in a broad way. This can drag on for years. Different courts in India may handle these cases differently.

This makes foreign companies nervous. They are afraid that even if they win a case in India, they might have a hard time getting their money back within a reasonable time. On the other hand, Singapore’s courts are known for being fast, predictable and supportive of arbitration. They usually settle cases related to arbitration in a matter of weeks or months and rarely interfere with the outcome.

India’s Supreme Court has done a lot to show that it supports enforcement. The reality on the ground is still not ideal. Until enforcement becomes more consistent, efficient and predictable across India, it will be hard for the country to compete with established arbitration hubs.

Indian companies are actually choosing to use arbitration in Singapore. This is a strong signal. In practice, this means that companies based in Bengaluru, Mumbai and Delhi often include arbitration clauses in their contracts that say any disputes will be handled in Singapore. They do this for several reasons:

• They think Singapore is a stable place to handle disputes, which is especially important when foreign investors are involved.

• They think the arbitration process in Singapore is efficient.

• They trust the courts in Singapore to support arbitration and not interfere with the outcome.

• They know that many other companies are already using Singapore for arbitration so it is easier to negotiate and draft contracts.

For companies that are raising money from investors in Singapore or serving clients in other countries, using Singapore for arbitration is often the safest and most practical choice. Even though using arbitration in India might be cheaper and more familiar, companies are afraid of the risks and delays involved. In a way, Indian companies are helping to make foreign arbitration institutions stronger while the ones in India are not being used much.

There are reasons why people think the way they do about arbitration.

• Trust gap: Indian institutions have not shared data to prove that arbitration in India is faster, cheaper or more reliable than ad hoc arbitration. For example, users know how long cases take at the SIAC. They do not see statistics from Indian centres.

• The ecosystem is still growing: There are not enough trained arbitration professionals, such as arbitrators, case managers and lawyers across the country. The proposed Arbitration Council of India, which was supposed to accredit arbitrators and set standards, has been slow to start.

• Judicial culture and capacity: While higher courts support arbitration, lower courts face a backlog, limited capacity and different approaches. This creates uncertainty about how arbitration cases will be handled.

• Lack of user-focused metrics: Businesses make decisions based on facts. In arbitration hubs, institutions share reports on case lengths, settlement rates and costs. India has just started doing this. Many perceptions are still based on experiences rather than hard numbers.

Leaders like Gujarat Chief Minister Bhupendra Patel often talk about India's tradition of community-based dispute resolution, such as panchayats and mediation. These roots are valuable. Modern international trade also needs metrics, enforceable outcomes and professional administration. The Gujarat State Arbitration Centre's training of 52 mediators and arbitrators shows how this heritage can be combined with capacity building. This effort must be scaled up across the country to make a real difference in Indian arbitration.

Chief Justice Surya Kant says that India's arbitration framework must do more than work. It has to make people feel confident. It has to be trustworthy. To make this happen, we need to focus on how things are actually done, not just how they look. Some things need to change.

We need to make our institutions stronger. Indian arbitration centres need money to keep going, good leaders and modern systems to manage cases. They should tell us how they are doing by sharing information on how long things take, how much they cost and what the results are. They should also follow practices from around the world. If we link these institutions to making it easier to do business, more people will want to use them.

We need to create a group of professionals who are good at what they do. India needs to train and approve arbitrators, mediators and arbitration lawyers. If we have a working Arbitration Council of India or something like it, it can set standards and make sure the people making decisions are good and fair.

We need to make it easier to enforce awards. This means that the courts need to be faster and more consistent when it comes to enforcing awards. We could have courts just for commercial or arbitration cases, be stricter about delaying cases and make it clearer how to enforce awards.

We need to encourage people to choose India. We could give incentives to people who choose to use arbitration centres. For example, make it easier to go to court, give them special support or make it easier to do business in certain areas.

The State of Gujarat has linked growing industry, courts and alternative dispute resolution. They have been able to bring disputes back from other countries. If we do the same thing across the country and if the courts, institutions and professionals work together, India can become a place where people want to resolve their disputes.

India’s economy is growing. More people are investing in the country. Startups and big companies are working together across borders and disputes are going to occur. We can choose where and how we resolve them. The laws are in place. The buildings are being built. Now we just need to make sure that people have a good experience. If we can do that, India can become a hub for arbitration, not just in Asia but in the whole world.

Aditi Shivadhatri is an Advocate practicing before the Supreme Court of India, currently pursuing an LL.M. in International Arbitration and Dispute Resolution at the National University of Singapore.