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A facility dedicated
to addressing legal issues in Indian Core Sector
Since the advent of liberalization
and the beginning of the economic reforms process in 1991, we have
been witnessing hectic activity in the legal-regulatory arena. Investors,
project developers, policy makers and in fact all the interested
parties in the new environment have been analyzing and assessing
every legislation and every notification issued by the government
for its legal implications.
Over the last few years several
far reaching legislative changes have taken place in the Core Sector.
Be it insurance, power, telecom, IT or environment these changes
have impacted industry structures and the legal environment in which
business was being conducted or project development was taking place.
With greater interest shown by private sector to participate in
infrastructure development, legal issues in areas of agreements
and contract management had to be addressed.
In the changing environment, an
understanding of regulatory and legal issues has been very important
for all the players. At times, debates on some of the issues in
Power Purchase Agreements and Fuel Supply Agreements have lasted
for more than a year.
Several large infrastructure projects
have been embroiled in legal issues created due to public interest
litigation, environmental issues and issues related to securitization
and escrow. Often matters have reached the Supreme Court of India.
In the shift from command to market driven economy there is going
to be less and less direct intervention from the governments and
instead markets and industries are increasingly being regulated
by Law. Regulatory Authorities have been set up in various sectors
including telecom, power, insurance etc. Legal issues, therefore,
will remain central to the development of the Core Sector.
In one of the Infrastructure sector- Telecom- when
it opened to private players, few imagined that it would emerge
as one of India's most litigious business. A report in August, 2003
suggested that over the last 32 months, 95 lawsuits- petitions and
appeals, have been filed with TDSAT, the industry dispute settlement
bench set up in 2000. That's an average of one lawsuit filed every
10 days.
According to one eminent lawyer, litigation happens
worldwide in the initial years after new policies, but taper off
as courts set legal precedents. Three reasons - the policy flip-flops,
the presence of overseas investors and the poor quality of regulation
have been offered as possible explanations for the rush of lawsuits
in infrastructure projects.
IndiaCore Law Centre has been set
up with the objective of creating a better awareness and facilitating
a greater understanding of legal issues in the context of core sector
development.
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