STRENGTHENING INDIA-UAE RELATIONS THROUGH ARBITRATION: THE PATH FORWARD

05 March 2024

Dhruv Jose

In a significant development that underscores the deepening economic and legal ties between India and the United Arab Emirates (UAE), as the way was paved to enhance bilateral cooperation which culminated in the signing of the India-UAE bilateral investment treaty on February 13, 2024.

Dubai:  In recent years, the relationship between India and the United Arab Emirates (UAE) has witnessed significant growth, marked by trade collaborations, investment initiatives, and bilateral agreements. Central to this advancement is the realm of arbitration, highlighted by the inaugural India-MENA Arbitration Summit held in Hyderabad.

This landmark treaty, along with eight other agreements including the Comprehensive Economic Partnership Agreement (CEPA), aims to bolster economic and legal collaborations between the two nations.

A notable event that coincided with these developments was the inaugural India-MENA Arbitration Summit held in Hyderabad on February 17 and 18, 2024. Organized by the International Arbitration and Mediation Centre (IAMC), the summit brought together leading figures from the global arbitration community. The discussions at the summit highlighted the growing need for a specialized arbitration bar in India, the expansion of trade relations between India and the UAE, and the challenges and opportunities presented by the India-UAE bilateral investment treaty of 2013.

One of the critical issues addressed at the summit was the enforcement of UAE-seated arbitral awards in India. Currently, due to the technicalities of the Indian Arbitration and Conciliation Act 1996 and the absence of the UAE in the list of territories notified by the Indian government, UAE-seated awards cannot be directly enforced in India. However, a workaround exists through the Notification of January 17, 2020, which allows for the enforcement of such awards after they are ratified and converted into decrees by UAE courts.

Despite the strides made in fostering economic ties, challenges persist, particularly concerning the enforcement of arbitral awards between India and the UAE. The absence of UAE from the list of territories notified under Section 44 of the Indian Arbitration and Conciliation Act 1996 poses a hurdle for enforcing UAE-seated awards in India. However, a workaround exists through a Notification issued by the Indian government, designating the UAE as a reciprocating territory under Section 44A of the Code of Civil Procedure (CPC). This mechanism enables the enforcement of decrees issued by certain UAE courts in India, albeit after ratification and conversion into judgments in the UAE.

Addressing this legal intricacy is paramount to bolstering India-UAE arbitration dynamics. The Agreement between India and the UAE on Juridical and Judicial Cooperation in Civil and Commercial matters underscores the importance of recognizing and enforcing arbitral awards between the two nations. However, practical measures are essential to operationalize this commitment, including the declaration of the UAE as a reciprocating territory for arbitration awards, aligning with the objective of facilitating seamless cross-border investments.

The Summit serves as a pivotal platform to advocate for such regulatory reforms and foster greater collaboration in dispute resolution mechanisms. By promoting regional cooperation and enhancing the arbitration ecosystem, India and the UAE can fortify investor confidence, stimulate economic growth, and pave the way for sustained partnership. Moreover, initiatives like the India-MENA Arbitration Summit are instrumental in raising awareness, fostering dialogue, and charting a roadmap for future engagements in arbitration.

The Way Forward

The discussions at the India-MENA Arbitration Summit serve as a crucial starting point for increasing awareness and promoting regional collaboration between India and the MENA region. The need for India to declare the UAE as a reciprocating territory for the recognition and enforcement of UAE-seated awards in India was a key takeaway. Such a move would not only build investor confidence but also lay the groundwork for sustained economic collaboration between the two countries, contributing to a harmonious and robust arbitration ecosystem.

In Conclusion

The inaugural India-MENA Arbitration Summit further underscores the commitment of both countries to fostering a robust framework for arbitration, essential for the seamless enforcement of arbitral awards and the promotion of investor confidence. As India and the UAE continue to deepen their ties, the emphasis on creating a specialized arbitration bar and the call for reciprocal recognition of arbitral awards highlight the evolving landscape of international arbitration.

This collaboration not only promises to enhance cross-border investments but also sets a precedent for legal and judicial cooperation on a global scale. The way forward, as illuminated by the summit, involves both nations working together to overcome legal hurdles, thereby paving the way for a future where economic and legal synergies contribute to a stable and prosperous partnership. This initiative is a testament to the power of diplomacy and dialogue in building bridges between nations, fostering an environment where commerce and justice can thrive in tandem.

ALKETBI TOUCH:

ALKETBI team is highly skilled and frequently provides legal assistance specializing in sustaining companies in their expansion and development, while believing in Dubai International capacities. We are at the forefront of the India – UAE legal relationship and can serve all your requirements via our team in the UAE and our Associates in India. If you request further guidance with relation to expanding or relocating to Dubai as a MENA hub, or any other legal related matter, Let us know!