Should India Adopt ISDS for IP Disputes? Re-Evaluating the Model BIT from IP and Public Health Perspective

Abstract

International investment agreements (“IIAs”) are increasingly incorporating intellectual property (“IP”) into the scope of ‘investment’, which has substantial implications for public health, particularly in developing economies such as India. In the budget speech of 2025, the Finance Minister of India, Ms. Nirmala Sitharaman stressed upon revising the Model Bilateral Investment Treaty (“BIT”) of India to draw more foreign direct investment (“FDI”). Simultaneously, the government of India is also apprehensive over Investor-State Dispute Settlement (“ISDS”) processes being utilised to contest legislations enacted for the public good. In the past, pharmaceutical or biotech firms have challenged host-state regulations through the use of investment protections in ISDS cases, which are discussed in the paper in some detail. As a capital-importing nation, India must prioritise attracting FDI while simultaneously, safeguarding public health of its citizens. This article analyses the changing investment environment in India and investigates the potential effects of forthcoming BIT reforms on the regulation of IP as an investment, while preserving the autonomy of public health policy laws. It concludes by proposing that India ought to completely adopt the ISDS mechanism in its BITs, as it cultivates investor confidence, attracts additional FDI, and bolsters India’s credibility in the global investment arena.