General Issue
Vol. V, No. 1
(Summer '13)

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India's first generation external sector reforms are a fascinating case study of emergence from a post-Independence socialist-style economy to the world’s largest free market democracy. Part I of this article reviews the Indian license Raj system that prevailed after the 1947 Partition of India until the decade of the 20th century. Part I explains the hallmarks and inefficiencies of that system. Part II discusses the reforms that began in earnest in 1991.

Part II focuses on reforms in the external sector, foreign direct investment, and the financial sector. Unfortunately, those reforms lost momentum by the early 2000s.

Thus, Part III analyses what happened, namely, backsliding on tariff cuts, persistent tariff escalations, and difficulties in the banking sector and in attracting FDI. Part III points out that India fared poorly as a result relative to its neighbours on the Sub-Continent.

Part IV concludes that the economic challenges India still faces in pushing ahead with reforms so that it remains not just the world's biggest free market democracy, but so that it becomes the most exciting and dynamic one, are largely political. Get the politics right, and India's future is bright.

This article compares the competition/antitrust laws of India and Canada, with special reference to issues concerning international trade, foreign investment, and economic development. It highlights similarities in the structure of corporate ownership and the changing nature of state intervention in the two countries. It then outlines the historical evolution of their competition laws, revealing several similarities and differences. The article concludes with a case study of a Canadian export cartel, which is exempted from Canadian competition law but has harmful effects on development priorities in India and poses a challenge for the extra- territorial application of India’s Competition Act.

Developing countries generally lack human and institutional capacity for analyzing the compatibility of trade measures taken by themselves and by other WTO members. As a result, the WTO legal order was significantly shaped by the United States and European Union and developing countries had very little participation in the dispute settlement process. India’s experience in overcoming some of these legal and institutional shortcomings in the matter of WTO dispute settlement is an interesting case study. India lost a few important cases such as the Mail Box (India-Patents) and the Balance of Payments (India-QR) in the decade of the late 1990s, the political overtones of which were felt for a long time. India relied on outside legal expertise for defending its interests in WTO dispute settlement and the costs involved in hiring external resources were often highlighted by opponents of trade and economic liberalization in India to argue against India’s participation in the WTO and the numerous trade agreements it administered. However, times have changed. India is now in a much better position to engage its own domestic lawyers and law firms in WTO dispute settlement. This article examines the measures taken by India, including the role of the government, private sector and inter-governmental organizations, in building legal capacity in India to augment its standing in WTO dispute settlement during the last few years and also the factors which have brought about this transformation. More recently, WTO cases involving India have exhibited a bottom-up approach of stakeholder participation where the government’s role is, to a greater extent, that of a handmaiden in meeting stakeholder demands. This article also analyzes the mechanisms available in India for identifying and challenging putative WTO inconsistent measures compared with the mechanisms available in the US, the EU and some key developing countries. On the one hand, this article will show how the WTO has shaped Indian strategies to engage with international dispute settlement, while on the other it addresses how India’s building of legal capacity can affect WTO legal ordering.

With twin concerns over traditional energy security and climate change shaping the current Indian energy narrative, India has a dual responsibility of ensuring energy supply and adopting a low carbon pathway. In addition, there is a new narrative emerging around India’s dual investment role – India is no longer just a host State for foreign investment, but also an outward investor. Subsequently, the article throws light on the Indian investment treaty programme and the rise of investor-State dispute settlement [ISDS] cases against India. Given India’s extensive investment treaty commitments, and the growing nexus between the energy sector and international investment law – this article attempts to explore the implications of India’s investment treaties and recent ISDS cases for any domestic energy-related regulatory action or policy decision, as well as for Indian energy-related investment aboard. In light of the increased calls for review or renegotiation of Indian investment treaties along with India’s twin concerns and dual role in the energy sector, this article argues for weaving in sustainable development concerns in existing Indian investment treaties to ensure a more flexible regulatory space, while ensuring that the investment treaty provisions are also sufficient to protect the interests of Indian investments abroad.

India’s insistence on flexibilities in pharmaceutical patent policies during TRIPS negotiations and the subsequent legislative implementation of TRIPS flexibilities led to India receiving attention in the pharmaceutical policy world early on. However, it is India’s actual usage of these flexibilities in the recent past – to prevent evergreening and to grant compulsory licenses – that has made nearly all parties interested in the effects of using flexibilities in the TRIPS Agreement sit up and take notice. India’s robust generics industry, burgeoning population and growing economy, contrasted with its significant poverty levels, make it a difficult country to ignore for countries on both sides of the rich-poor spectrum. With the (belated) fear that other developing countries may begin to take note of how they too can successfully implement such flexibilities, the newest wave of occidental pressure has come on stronger than ever. After examining the position and significance of pharmaceutical patents for the developing world, this article examines the specific developments that have led to this wave of pressure. Regardless of the increased access to medicines that these developments have brought about, India’s status as an influential state is on shaky ground if it is not in compliance with its international obligations under TRIPS. Drawing the conclusion that India is well within its rights under TRIPS, this paper goes on to explain the significance of India’s stance in the context of the tension a developing country faces between policy requirements and political pressures. Finally, the paper concludes by recognizing the difficult balance between incentivizing the creation of new medicines and ensuring maximum possible access to medicines that pharmaceutical innovation policy requires in the global context and recommends looking beyond just the patent system for pharmaceutical innovation.

This note assesses India’s policy of permitting foreign direct investment (FDI) up to 51 per cent in the multi brand retail-trading (MBRT) sector in light of India’s bilateral investment treaties (BITs). This is assessed by examining whether India’s BITs provide pre-entry national treatment protection to foreign investment or not. Based on this assessment, the note finds that this policy is consistent with India’s BIT obligations. However, the note argues that given the current political opposition to this policy and other features of India’s BIT like protection of foreign investment from both direct and indirect expropriation, reversal of this policy in future by a later government, after foreign investment has been made, might trigger BIT claims against India.