Uzbekistan-India Bilateral Investment Treaty (BIT)

Context

India and the Republic of Uzbekistan signed a Bilateral Investment Treaty in Tashkent.

Bilateral Investment Treaty (BIT)

• A BIT is a settlement between two countries to offer security to investments made by nationals and industries of one country within the different. It aims to create a positive funding climate and promote financial cooperation between the signatory countries.
• India’s BIT Framework: India adopted a new Model BIT in 2015, changing the earlier model from 1993. The new framework serves as the template for negotiating future BITs and the funding chapters of Free Trade Agreements (FTAs) and Economic Partnership Agreements.

Key Features of India’s Model BIT (2015)

• National Treatment: Foreign traders are to be treated similarly and fairly, much like domestic traders, in all matters besides in specific sectors in which exceptions are stated.
• Protection from Expropriation: Limits the capacity of the host countries to expropriate (take over) foreign investments except for public purposes, in a non-discriminatory manner, and with adequate repayment.
• Fair and Equitable Treatment: Ensures honest remedy of foreign traders, but does not automatically guarantee broader rights like those found in older treaties.
• Full security and Security: Investments by foreign traders could be given complete safety and security, steady with the laws of the host country.
• Dispute Settlement: Exhaustion of Local Remedies: Investors should first try and remedy disputes in the prison framework of the host country, and handiest after exhausting all local remedies can they initiate global arbitration.
• Non-Discriminatory Treatment: Ensures safety from discrimination, particularly with respect to domestic traders, and guarantees Most-Favored-Nation (MFN) treatment.

India -Uzbekistan Relations

• Economic and Trade Relations:

• • • Trade: India-Uzbekistan trade has witnessed boom through the years, even though the capacity remains largely untapped. The most important exports from India include pharmaceuticals, machinery, digital products, and textiles, even as Uzbekistan exports items like fruits, fertilizers, and uncooked substances.
    • Bilateral Trade Agreement: Both countries have a Bilateral Investment Treaty (BIT) in location, which protects and promotes investments. They also are operating on finalizing a Preferential Trade Agreement (PTA) to enhance trade relations.
    • Pharmaceuticals: Indian pharmaceutical corporations have a considerable presence in Uzbekistan, and there have been ongoing efforts to beautify this partnership similarly. India resources about 25% of Uzbekistan’s pharmaceutical needs.
    • Information Technology: Uzbekistan is increasingly searching for India’s understanding in Information Technology and virtual governance.

• Defense Cooperation:

• • • Military Exercises: India and Uzbekistan frequently interact in joint military exercises including DUSTLIK, aimed toward enhancing counter-terrorism cooperation.
    • Defense Training: India presents army training to Uzbek armed forces through its numerous institutions, enhancing capacity-building efforts.
    • Security Cooperation: Both countries cooperate on counterterrorism, anti-radicalization, and intelligence-sharing, especially in the context of growing security issues in Afghanistan and Central Asia.

• Cultural Relations:

• • • Cultural Exchanges: India and Uzbekistan have vibrant cultural exchanges that concentrate on arts, music, dance, and yoga. Hindi is also widely taught in Uzbekistan, and Bollywood is extraordinarily famous.
    • People-to-People Ties: There is a developing interest between the Uzbek populace in India’s conventional medicine systems like Ayurveda and Yoga. Uzbekistan frequently participates in cultural festivals in India, and vice versa.

• Energy and Renewable Resources:

• • • Energy Cooperation: Uzbekistan is wealthy in herbal resources, and India has expressed interest in developing strong partnerships in regions like herbal fuel and renewable electricity.
    • Nuclear Cooperation: Both nations signed a civil nuclear cooperation settlement for non violent functions, focusing on the trade of understanding and era in nuclear energy.

• Challenges

• • Geopolitical Concerns: Afghanistan’s instability stays a situation for both India and Uzbekistan, mainly after the Taliban takeover. Both countries are operating to deal with common security challenges.
  • Trade Barriers: Despite the developing courting, bilateral trade remains under capacity due to connectivity issues, regulatory boundaries, and shortage of direct transportation links.

Source: PIB