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India’s Business Culture: Meandering Pace of Justice

by Brandi Moore on July 22, 2010

India Court Delays Crush India Business RelationshipsFor Americans doing business in India its critical to understand that India’s courts need to be the last answer to settle disputes.  This is why engaging India’s business culture with an ongoing strategy and understanding clearly how to continue a solid relationship is critical to success.  Relationships matter in India.  Relationships in business settings are through of as long term relationships, not relationships about tasks.  When executives spend the time to constantly engage India problems are greatly reduced.  Using strategies simliar to the US, where litigation is a fact of life for corporations doesn’t work in India unless you are willing to wait for a decade to settle a problem.

Another strategy to consider is to bring in a third party into your relationship early.  This intermediary will serve you when a problem presents.  Instead of threatening contract violation you can instead engage a second level of negotiations / conversations with a reliable third party.

According to Business Week “Its well-known that Litigation in India is a no-go zone for companies because of how long it takes.”

Long means up to 25 years for litigation to be settled.  The average length of time is 12 years.  India’s legal system also breed corruption because of low judge pay and these incredible time lags. Bloomberg magazine covered the hopeful changes put forward by the Law & Justice Minister for India’s courts.  This will reduce the length of time to an average of 3 years to settle disputes.

Americans also should note that India does not allow foreign lawyers to provide legal guidance.  Law firms from the US have been allowed to create tie-ups / alliances with Legal teams in India but that is the extent of their ability to help.  India has a pending lawsuit that is intending to ban 31 foreign firms to keep the Indian profession in country the only viable option for American investors.

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{ 2 comments… read them below or add one }

sangeeta May 11, 2011 at 6:02 pm

I agree it takes long in Indian courts but lot is changing fast. U can get back to me for updates on the legal reforms undertaken by the Indian courts and Government recently. This can attract the investors here to do business here and get speedy redressal of their cases. Sangeeta Sharma-courts reporter with United News of India

sangeeta May 11, 2011 at 6:07 pm

India has now one of the best Mediation and Conciliation centre at the Delhi High Court and most of the cases are being settled there within one or two months-Sangeeta-Court Reporter-UNI

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