"India aspires to be a global arbitration hub, yet the State remains its biggest litigant." Critically examine this statement in light of recent Supreme Court observations.

In November 2026 the Supreme Court dismissed the Centre's appeal against enforcement of foreign awards worth about $99 million in the Vedanta–Ravva dispute. It warned the Centre: "Nobody will trust you" [1]. The remark points to a contradiction. India promotes itself as an arbitration seat, yet the State keeps resisting awards it loses.

Why the statement largely holds

• Endless resistance: The tribunal gave its first award in 2004 and its final award in 2016. Malaysia's Federal Court, the court at the seat, upheld it in 2019. The Centre still contested enforcement until 2026 [1].
• Arguing the merits at the wrong stage: The Centre said the tribunal had "rewritten" the production-sharing contract. But Section 48 of the Arbitration Act allows refusal only on narrow grounds [2], and the enforcing court cannot review the merits [4]. A mere breach of a statute is not a public-policy ground [3].
• Repeat pattern: In 2020 the SC had already rejected the government's challenge to a separate Ravva award [7].
• Institutional neglect: A Parliamentary Standing Committee found that PSUs do not even consider institutional arbitration when drafting contracts [5].
• Reciprocity at stake: The New York Convention works only if member countries enforce each other's awards [8]. The earlier Cairn and Vodafone tax arbitrations had already hurt India's credibility.

The other side

• Public money: Profit petroleum is the public's share of oil revenue, so checking an award closely is part of the State's duty [1].
• A legitimate safety valve: Courts can still refuse enforcement if it violates the fundamental policy of Indian law, the interests of India, or justice and morality, or if the award involved fraud or corruption [7].
• Reforms under way: The 2016 amendment made the public-policy ground the same for domestic and foreign awards [3]. Vivad se Vishwas II offered a way to settle contract disputes with the government [6].
• Courts as the corrective: The judiciary's steady pro-enforcement rulings themselves show that India can be a reliable seat [3][4].

Way forward

• A senior committee should screen appeals and record its reasons in writing. Good-faith decisions not to appeal should be protected from vigilance action.
• Make the IIAC the default forum in PSU contracts [5].
• Offer a settlement route like Vivad se Vishwas for long-running foreign-seated award disputes.

Overall, the statement is largely valid. The main obstacle to India becoming an arbitration hub is the State's conduct as a litigant, not its laws. The courts have done their part. A disciplined litigation policy that honours final awards would make India a trusted seat and strengthen the rule of law under SDG 16.