India-Kyrgyzstan Bilateral Investment Treaty (BIT) Officially Enters into Force | Current Affairs | Vision IAS
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India-Kyrgyzstan Bilateral Investment Treaty (BIT) Officially Enters into Force

Posted 06 Jun 2025

2 min read

The Bilateral Investment Treaty (BIT) signed in June, 2019, enters into force with effect from 5th June 2025. 

  • This new BIT replaces the earlier agreement enforced in 2000, ensuring continuity in the protection of investments between the two nations.

India-Kyrgyzstan Bilateral Investment Treaty (BIT)

  • The BIT balances the investor rights with the sovereign regulatory powers of both countries, and reflects a shared commitment to create a resilient and transparent investment climate. 
  • Key Features of the BIT
    • Definition of Assets: Enterprise-based definition with an inclusion and exclusion list & clarifies investment characteristics: capital commitment, profit expectation, risk assumption, etc.
    • Exclusions for Policy Space: Excludes local government, government procurement, taxation, compulsory licenses, etc.
    • Removes the Most Favored Nation (MFN) clause: Which previously allowed investors to selectively import favorable provisions from other treaties signed by the Host State. 
      • This removal will ensure more consistent treatment.
    • The BIT contains General and security exceptions: The attempt is to carve out a policy space for the State. 
      • General exceptions E.g., Protection of environment, ensuring public health and safety, etc.
    • Revised dispute resolution mechanism: Requires investors to first use local remedies before international arbitration, promoting alternative dispute resolution.

About Bilateral Investment Treaty (BIT)

  • Definition: Also referred to as International Investment Agreements (IIAs), they are a tool for providing assurance to foreign investors against measures that may adversely impact their investments while assuring state's sovereign right to regulate. 
  • They allow investors or home countries to sue the host country for investment-related disputes.
  • India approved new Model BIT Text in 2015, which replaced Indian Model BIT, 1993.
  • Since 2015 India signed BITs with: Uzbekistan (2024), UAE (2024), Brazil (2020), Belarus (2018).
  • Tags :
  • Bilateral Investment Treaty
  • Kyrgyzstan
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