India not a preferred destination for international arbitration disputes despite reforms: CJI Surya Kant

Chief Justice of India (CJI) Surya Kant on Saturday said that parties to international arbitration disputes in India continue to choose seats outside the country, despite legislative and judicial reforms aimed at strengthening the country’s arbitration framework..He said that the real question is not whether arbitration as a mechanism is viable, but whether Indian institutions inspire sufficient confidence to become the preferred choice for domestic and global parties.“Our international arbitration disputes have their preferred destinations outside India. The question we must confront is not whether arbitration is viable; it is whether our institutions inspire sufficient trust to become the most preferred choice,” the Chief Justice said..Justice Kant was speaking at the inauguration of the new building of the Gujarat High Court Arbitration Centre (GHAC) and the inaugural session of a two-day conference on Institutional Arbitration at Crossroads: Challenges and Way Forward..Justice Kant noted that even thought India’s arbitration framework has matured in recent years through amendments to the Arbitration and Conciliation Act and reinforcement by courts, institutional arbitration in India still occupies a smaller space than it should.The Chief Justice identified trust as the foremost challenge facing institutional arbitration in the country. He said that neutrality in arbitrator appointments, procedural integrity and enforceability of awards are central to building confidence among users.“Institutional arbitration fulfils its promise only when users genuinely trust it - trust in the neutrality of arbitrator appointments, trust in procedural integrity, trust in the enforceability of awards. That trust is not built by rules on paper. It is built through consistent, transparent and demonstrably fair practice over time,” he said..Coming to the new arbitration centre, Justice Kant said that infrastructure alone cannot solve the issue.He described the centre as more than a building. Dedicated hearing halls, digital systems and confidentiality safeguards show seriousness of purpose, he said.In commercial matters, he added, time is capital and certainty is currency..Turning to capacity concerns, the Chief Justice said that institutional arbitration in India remains disproportionately small compared to the volume of commercial disputes generated in the country.He noted that many parties continue to default to ad hoc arbitration or conventional court litigation because institutions have not sufficiently demonstrated their added value.Justice Kant also flagged professionalism as a critical area requiring attention. He said that arbitration demands specialised legal expertise, case management skills and sensitivity to cross-border commercial realities.“India must invest seriously in training arbitrators, in building institutional administrative capacity and in developing a coherent pipeline of qualified arbitral professionals. Without that investment, growth in the number of institutions will outpace growth in the quality of the process and the gap between form and substance will only widen,” he said..The CJI emphasised that India must measure its progress not against its past, but against leading global arbitral seats and the legitimate expectations of parties seeking faster and more efficient dispute resolution than traditional litigation.He concluded by urging candour and institutional honesty in evaluating the present state of arbitration in India."We must be willing to measure ourselves not against where we began, but against where we need to be - against the standards of the leading arbitral seats of the world, and against the legitimate expectations of parties who choose arbitration in the hope of something better and faster than litigation." he said..Follow Bar and Bench channel on WhatsAppDownload the Bar and Bench Mobile app for instant access to the latest legal news.