India rejects attempts by EU, Canada for global investment agreement
India, along with Brazil, Argentina and some other nations, has rejected an informal attempt by the European Union (EU) and Canada to work towards a global investment agreement at the World Trade Organisation (WTO)-level that would incorporate a contentious Investor-State Dispute Settlement (ISDS) mechanism.
The ISDS mechanism has become contentious as it permits companies to drag governments to international arbitration without exhausting the local remedies and claim huge amounts as compensation citing losses they suffered due to reasons, including policy changes.
The EU and Canada have inked an investment pact that has incorporated the contentious ISDS. At the meeting (of trade ministers of select countries held on the sidelines of the recently held World Economic Forum in Switzerland), they wanted the investment pact to be the template for a similar multilateral agreement. India summarily rejected such an idea.