New Delhi, Aug. 25 -- An effort to reset India's model bilateral investment treaty (BIT) began last year with the budget noting the need to make it investor-friendly, streamline dispute resolution and protect outbound investments.

Foreign direct investment (FDI) is a significant driver of economic growth. Both the 2025-26 and 2026-27 budgets emphasized the need to ensure people-friendly and trust-based regulatory investment frameworks appropriate for the 21st century. This applies equally to domestic and foreign investments.

FDI is estimated to constitute only around 2% of India's gross domestic product (GDP). According to World Bank estimates, gross fixed capital formation (GFCF) was 29.6% of GDP in India in 2024 and gross domestic sav...