India is decoupling from trade law in its new FTAs, excluding investment protection rules to exercise greater control over foreign investment.
Author
Prabhash Ranjan, Vice Dean (Research), Jindal Global Law School, O.P. Jindal Global University, Sonipat, India
Summary
Purpose: This paper aims to show that India is decoupling its international investment law obligations from its international trade law obligations. This decoupling goes beyond the split between investment protection rules and trade agreements. If investment protection rules are missing from the trade agreement, it is a case of partial decoupling. If India does not legalize its investment relations with a country with whom it has signed a free trade agreement (FTA), either within or outside the trade agreement, it becomes a case of complete decoupling.
Design/methodology/approach: This paper follows doctrinal methodology. It compares India’s past FTA practice with the new one to show the dissimilarity between India’s FTA 1.0 and 2.0.
Findings: India’s new FTAs differ from the FTAs signed in the 2000s. Unlike the previous FTAs, the new ones do not contain investment protection rules. India is indulging in decoupling because it wants to de-legalize its international investment relations to exercise greater control over foreign investment. The paper concludes by observing that as India’s fundamental reason for signing FTAs is to be part of global value chains, it should consider including investment protection rules within its trade agreements.
Originality/value: No research yet compares India’s past FTAs with the new ones to show that investment protection is no longer part of India’s trade agreement practice.
Published in: Journal of International Trade Law and Policy
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