Economic Liberalism

This chapter discusses the Balance of Payments (BoP) crisis of 1991 that led to the advent of economic reforms that changed the course of India’s economic trajectory for ever. As a conscious break from the past, India undertook many bold structural economic reforms. Liberalization of foreign investment was one of them. This ushered in an age of embracement of BITs and the willingness to be bound by those international law principles pertaining to foreign investment that India had opposed earlier. India started negotiating and signing BITs from 1992 with the clear objective of promoting and protecting foreign investment in India. In this phase, India had a marginal involvement in investor–state dispute settlement (ISDS) cases. Also, there was not much discussion on the impact of BITs on India’s right to regulate. The BITs singed in this period resembled the laissez faire liberalism model.