London court revives RAKIA arbitration claim against India

In a development that potentially impacts India's bilateral investment obligations, the Commercial Court of the High Court of Justice in London has revived a $273 million arbitration claim filed by the Ras Al Khaimah Investment Authority (RAKIA)—the sovereign investment arm of the UAE emirate of Ras Al Khaimah—against the Government of India.

- ABHINANDAN MISHRA

The June 20 ruling overturns a 2022 international arbitration tribunal decision that had dismissed the case on jurisdictional grounds.

The dispute stems from a cancelled bauxite mining and aluminum project in Andhra Pradesh, in which RAKIA had invested over $42 million through a joint venture company, ANRAK Aluminum Ltd, in partnership with India's Penna Group. The investment followed a 2007 Memorandum of Understanding between the governments of Andhra Pradesh and Ras Al Khaimah.

While the project secured environmental clearances, forest approvals remained pending. In November 2015, the Andhra Pradesh government moved to operationalise the bauxite supply plan. However, on December 22, 2015, then Chief Minister N. Chandrababu Naidu announced in the state Assembly that the project would be cancelled—a decision later formalized through a government order in April 2016.

In December 2016, RAKIA filed for arbitration under the India-UAE Bilateral Investment Treaty (BIT), signed in 2013, alleging that the cancellation violated investment protections guaranteed under the treaty.