Published on: 25 January, 2026 17:33 IST
Arbitration in India has come a long way from being a sluggish alternative to courtroom battles, evolving into a sleek, investor-friendly mechanism that’s drawing global attention. Once plagued by endless delays and judicial meddling, the system is now buzzing with reforms aimed at speed, efficiency, and international standards.
But as we hit 2026, challenges like institutional independence and enforcement linger. Drawing from a 2023 Economic Times spotlight on alternative dispute resolution (ADR) – which highlighted the new Mediation Act while praising firms like S&A Law Offices for their arbitration prowess – let’s unpack the journey, weaving in the latest twists from court rulings, legislative drafts, and high-stakes cases.
The 2023 Foundation: Mediation Act Paves the Way for Broader ADR Reforms
Back in December 2023, as detailed in The Economic Times’ Corporate Law section, India took a bold step toward formalizing mediation with the Mediation Act, 2023. This legislation, passed unanimously in Parliament’s monsoon session and receiving presidential assent, marked a significant milestone in the country’s legal framework. It institutionalized mediation as a critical alternative dispute resolution tool, addressing the long-standing absence of a dedicated governing structure.
Key highlights from the Act include:
- Scope and Applicability: It applies to mediations within India involving parties residing, incorporated, or operating businesses in the country. This extends to international commercial disputes ignited by mediation agreements.
- Enforceability Under Section 27: A mediated settlement agreement is deemed final and binding, enforceable as a court decree or judgment under the Code of Civil Procedure, 1908. This gives mediated outcomes real teeth, reducing the need for further litigation.
- Flexibility for Parties: Parties can opt for mediation even after a dispute arises, promoting voluntary resolution over adversarial proceedings.
- Non-Participation Clause: The Act doesn’t include disputes with non-participating parties, certain regulated sectors, or those governed by the Legal Services Authorities Act, 1987. Criminal offenses, child abuse, and serious disputes like those under the Legal Services Act are excluded to ensure appropriate safeguards.
The article emphasized mediation’s historical roots as an effective, self-reliant dispute tool, maturing over time to fit modern needs. It noted how Indian courts and legislation had long recognized mediation, but lacked a unified frame until this Act.
Tying into arbitration, the piece spotlighted S&A Law Offices’ ADR practice as a top-tier example. Led by Manoj K. Singh, a recognized leader in dispute resolution, S&A has excelled in channeling disputes toward negotiation. Their expertise spans domestic and international arbitration – both institutional and ad hoc – under rules from bodies like the International Chamber of Commerce (ICC), London Court of International Arbitration (LCIA), Singapore International Arbitration Centre (SIAC), and the ADR Institute of Alberta. The firm has represented clients in high-stakes cases across sectors like infrastructure, energy, construction, international contracts, insurance, roads, ports, natural resources, mining, and product liability. What sets S&A apart is its involvement in unique, exemplary cases, fostering a culture of continuous learning and success.
This 2023 update underscored ADR’s growing role, with mediation complementing arbitration to ease judicial burdens. But arbitration itself was ripe for change, setting the stage for subsequent reforms.
2024: Guidelines and Proposed Amendments Kickstart Modernization
2024 was a pivotal year for arbitration, with the government introducing new guidelines and floating ambitious amendments. In June 2024, the Ministry of Finance issued “Guidelines for Arbitration and Mediation in Contracts of Domestic Public Procurement,” shifting focus from arbitration as the default for government contracts to mediation for low-value disputes (under ₹10 crore). This aimed to reduce costs and delays in public procurement, reflecting a balanced ADR approach.
On the legislative front, the draft Arbitration and Conciliation (Amendment) Bill, 2024, proposed sweeping changes to the 1996 Act:
- Renaming and Streamlining: Dropping “conciliation” from the title to rename it the Arbitration Act, emphasizing arbitration’s primacy.
- Emergency Arbitration Recognition: Statutory backing for emergency arbitrators, allowing interim relief before full tribunals form – a boost for urgent commercial disputes.
- Seat vs. Venue Distinction: Clarifying that the “seat” determines jurisdiction, while “venue” is merely logistical, reducing confusion in multi-location arbitrations.
- Arbitration Council of India (ACI) Revival: Revisiting the ACI’s structure and powers, first proposed in 2019 but stalled. The draft aimed to enhance institutional independence while addressing executive involvement concerns.
Institutional arbitration saw a surge: The Mumbai Centre for International Arbitration (MCIA) reported a 48% increase in new cases, from 23 in 2023 to 34 in 2024, highlighting growing trust in bodies like MCIA, DIAC, and SIAC for India-seated matters.
Court interventions decreased, with Supreme Court rulings like those in construction disputes emphasizing minimal interference, aligning with pro-arbitration trends.
2025: International Ties Strengthen Amid Domestic Tweaks
By 2025, India’s arbitration scene went global. The UK Arbitration Act amendments influenced Indian discussions, introducing defaults on governing law for arbitration agreements – a move India mirrored in its evolving jurisprudence.
Key developments:
- India-Japan Convergence: Enhanced bilateral ties through aligned laws, pro-enforcement courts, and tech-enabled resolutions, as analyzed by Kochhar & Co.
- Indus Waters Treaty: The Permanent Court of Arbitration (PCA) handled ongoing India-Pakistan disputes, with updates on neutral expert proceedings in early 2025.
- Supreme Court Digest: LiveLaw’s 2025 Arbitration Annual Digest (Parts 1 & 2) chronicled landmark rulings, including on arbitral awards, interim measures, and procedural rules.
- Tech and Flexibility: Reforms emphasized procedural flexibility, reducing formalism under BEPS-like global standards.
High-profile cases like Reliance Industries and BP’s KG-D6 gas field dispute – with $30 billion at stake over output targets – headed to arbitration, with rulings expected in 2026.
Into 2026: ACI Debates and Ongoing Cases
As of January 2026, the draft 2024 Bill remains under debate, with fresh calls for ACI operationalization to promote institutional arbitration and cut judicial loads. UPSC aspirants are even noting it as a hot topic for exams, per educator Raj Malhotra.
Recent X buzz includes Panthera Resources’ arbitration against India for a $1.58 billion gold claim, and Dev Accelerator’s adjourned case to Jan 31, 2026. The ICC’s 8th India Conference in December 2025 focused on these trends, networking lawyers and judges.
Research from Columbia’s ARIA journal and ResearchGate highlights structural challenges like enforcement delays but praises India’s pro-arbitration shift, with FDI inflows rising due to reforms.
The Road Ahead: Promise and Pitfalls
India’s arbitration ecosystem is thriving, but success hinges on fully implementing the ACI, minimizing court interference, and embracing tech. With global businesses eyeing India, these reforms could make it an arbitration hub rivaling Singapore or London. Yet, as S&A’s success shows, expert firms remain key to navigating this dynamic landscape. Watch for the 2024 Bill’s fate – it could redefine dispute resolution for generations.