September 27, 2024
The agreement was signed by Finance Minister Nirmala Sitharaman and Uzbekistan’s Deputy Prime Minister Khodjayev Jamshid Abdukhakimovich in Tashkent
The treaty ensures fair treatment and non-discrimination for investors while also providing an independent forum for arbitration in disputes
Key provisions include protection from expropriation, transparency, and compensation for losses, strengthening the investment climate
The treaty maintains a balance between investor protection and the right of states to regulate, ensuring adequate policy space for both nations
India and Uzbekistan have taken a significant step towards bolstering economic ties by signing a Bilateral Investment Treaty (BIT). Finance Minister Nirmala Sitharaman and Uzbekistan’s Deputy Prime Minister Khodjayev Jamshid Abdukhakimovich formalised the agreement in Tashkent, marking a milestone for both nations.
The treaty aims to boost investor confidence by ensuring a minimum standard of treatment, non-discrimination, and access to an independent forum for resolving disputes through arbitration. It also safeguards investments from expropriation while promoting transparency and providing compensation for potential losses.
While the treaty provides comprehensive protection for investors, it also preserves the right of both governments to regulate in the public interest, maintaining crucial policy space for state-led initiatives. This balance is essential in fostering a fair investment environment while protecting national interests.
The BIT reflects a shared commitment between India and Uzbekistan to enhance economic cooperation and create a more resilient investment ecosystem. Officials expect the treaty to pave the way for increased bilateral investments, benefiting the business sectors in both countries.
Indian companies have already established a foothold in Uzbekistan, with notable investments in pharmaceuticals, amusement parks, automobile components, and hospitality. Since April 2000, Overseas Direct Investment (ODI) from India to Uzbekistan has reached US$ 20 million, signalling strong potential for future growth.
Source: Economic Times