MUMBAI: As a member of theSingapore Conventionon Mediation (Convention), India can play a role in the swift resolution of corporate disputes through mediation, a senior Singaporean minister told ET.
This comes amid the government’s efforts to improve India’s ranking in ‘Ease of doing Business’.
The Convention, which came into force in September, and is a significant development in international commercial dispute resolution and will surely help India’s case in ‘Ease of doing Business’, said Kasiviswanathan Shanmugam, Singapore’s Minister of Home Affairs and Minister of Law.
Once India ratifies the Convention, businesses here will have greater certainty in resolving cross-border disputes through mediation, as the Convention provides a more effective means to enforce mediated outcomes, Shanmugam said. He said ratification by Indian parliament will encourage investments into India.
The Convention — also known as the United Nations Convention on International Settlement Agreements Resulting from Mediation — will provide an effective way of enforcing mediated settlements of corporate disputes involving businesses in India and other countries that are signatories to the convention.
“I think the lessons that we can share from the International Financial Center will be on structuring some of the rules and regulations with regard to what has worked in the past and what hasn’t. What sort of watchdogs, regulatory authorities and agencies do you need?” Shanmugam told ET in a video interaction.
The Minister noted that New York and Shanghai are financial centres because ofthe United Statespre-eminent position in the world economy and China’s large economy, respectively.
Similarly, India’s large internal economy offers many possibilities for the development of an international financial centre, he said.
More than 50 countries have already signed the Convention, including India, the US and China.
“We want to persuade other countries to sign up as well, and those which have signed up, we want them to ratify,” Shanmugam said.
He noted that the Indian legislative calendar has many other major issues, but ratifying the Convention is likely to have bipartisan support as it is not a political issue.
The Convention is expected to get as much momentum as the New York Convention going forward since this will help all parties resolve their disputes faster and quickly.
New York Convention or the Convention on the Recognition and Enforcement of Foreign Arbitral Awards came in force in 1959, under which all the signatory parties including India recognise and enforce arbitration awards made in the other contracting states.
As per the National Judicial Data Grid (NJDG), currently, courts in the country have over 32.2 million pending cases. This includes 4.8 million cases in 25 high courts and about 150,000 cases in the Supreme Court.
Similarly, as per latest Insolvency & Bankruptcy Board of India (IBBI) data, about 4,008 cases were reported under the Corporate Insolvency Resolution Process (CIRP) from the time of inception and out of those, 1,942 cases are still pending in various NCLTs.
This paves the way for several parties to choose mediation as a way to resolve their disputes.