DISPUTES ARISING OUT OF FOREIGN DIRECT INVESTMENTS IN PAKISTAN: A NEW LOOK AT LEGAL AND POLITICAL ISSUES
Abstract
Arbitration refers to the jurisdictional process in which an arbitrator decides to resolve a conflict and grievances between two parties as a neutral third party. The International Center for the Settlement of Investment Disputes (ICSID) is an international arbitration body for investment disputes, working under World Bank. This study evaluates the cases of arbitration carried out by ICSID in the investment disputes of Pakistan. The cases include Tethyan Copper Company Pvt Limited, Bayindir Insaat Turizm Ticaret Ve Sanayi A.S, Karkey Karadeniz Elektrik Uretim A.S., and Agility for Public Warehousing Company K.S.C. This study is designed to explore current trends regarding direct foreign investment and its regulatory framework in Pakistan. This research has also focused on the challenges and implications in direct foreign investments and the disputes arising out of these investments and subsequently effect of these disputes on economic growth. The causes of disputes arise out of investments are also tried to find which include the feudalism in Pakistan's government, poor coordination and lack of trust between different authorities resulting in delays and failure to pay expenses or effecting Pakistan’s reputation.. Lastly, this paper highlights those issues that negatively affect foreign investments in Pakistan and for that those cases are taken in consideration who reached in ICSID for arbitration arose out of foreign Investment in Pakistan. Results of this study show that Foreign Direct Investment (FDI) in the long run will bring economic growth. In a country like Pakistan, there is a need for balanced laws that will protect local and foreign investors