FinMin, DIPP officials to discuss revised BIPA model tomorrow
Jun 23 2014 , New Delhi
"The working group will examine the various issues relating to BIPA. The revised model of BIPA will also be discussed," an official told PTI.
Worried over frequent invocation of investment protection pacts by MNCs, the Commerce and Industry Ministry is in favour of gradually phasing them out saying that they hurt India's interest.
"The BIPAs are not serving the interest of India. They are damaging the country's interest. Several countries are cancelling such treaties," the official added.
A working group -- comprising of officials from the Department of Industrial Policy and Promotion and the Department of Economic Affairs as well as other ministries -- has already held meetings to examine the utility of BIPAs.
The official said these agreements do not play any major role in attracting foreign direct investment.
"FDI comes because of healthy business and investment climate of a country. Certain departments of the government are not in favour of these pacts and they are of the opinion that agreements should not be extended beyond the sunset clause. It should be revoked at the earliest," he added.
It has been pointed out by stakeholders that the Companies Act provides equal protection to domestic as well as foreign companies, and MNCs that face problems could easily approach courts.
The BIPA review talks have been put on hold following arbitration notices from foreign companies to recover investments.
Several global telecom firms which had lost their 2G licences following a Supreme Court judgement, have slapped notices on the government citing breach of bilateral investment protection pacts.
India has so far signed BIPAs with 82 countries. Of these, 72 including those with Russia, Germany, the UK and the Netherlands have already come into force and the remaining are in the process of being enforced.