India’s bilateral investment treaties (BITs) play a critical role in shaping the landscape for foreign investors by providing a legal framework that offers protection and promotes investments between India and other countries. The India bilateral investment treaties typically include provisions that ensure fair and equitable treatment and mechanisms for dispute resolution through international arbitration.

The impact of these treaties on foreign investors is multifaceted. On one hand, BITs enhance investor confidence by offering a degree of certainty and security, which is crucial for attracting foreign direct investment (FDI). They guarantee that foreign investments will be treated on par with domestic investments and will be protected from arbitrary or discriminatory actions by the host country​.

However, the landscape of India’s BITs has evolved significantly. In 2016, India introduced a new model BIT that aimed to balance investor protection with the country’s regulatory freedom, India terminated many existing BITs, which led to a temporary decline in FDI inflows as the renegotiation process created uncertainty among investors​​.

Despite these changes, India’s ongoing efforts to renegotiate and sign new BITs reflect a commitment to creating a more stable and predictable investment environment. The updated treaties aim to address previous shortcomings while still providing protections necessary to attract foreign investments, ensuring that the India bilateral investment treaties remain a cornerstone of the country’s strategy to boost economic growth through foreign investment​.