India’s revised model Bilateral Investment Treaty (BIT) is awaiting Union Cabinet approval as the government works to attract more foreign investment and advance negotiations with key trading partners.

The draft framework has been finalised and sent to the Cabinet, according to government sources. The proposed model is expected to retain India’s position that taxation matters remain outside the scope of investment treaties, preserving the government’s authority over tax policy.

The framework is also likely to retain the requirement that foreign investors first pursue domestic legal remedies before seeking international arbitration. However, the existing five-year period for exhausting local remedies could be shortened, with two years reportedly under consideration.

India is already negotiating BITs with several countries under the revised framework. Reports indicate that agreements with four countries are close to completion, while negotiations are also underway with Canada and other partners.

The existing Indian model BIT dates to 2015. The government has been reviewing the framework amid efforts to strengthen foreign investment flows and conclude wider trade agreements.