Finance Minister Nirmala Sitharaman said India has finalised a new template for bilateral investment treaties (BITs) and expects it to receive Cabinet nod shortly.
Speaking at the Munich Security Conference, Sitharaman said the framework has been under preparation for around 18 months and is intended to address limitations in the model adopted in 2016.
The new approach aims to provide stronger and more balanced protection to investors from both countries.
Sitharaman said India has continued negotiating investment protection agreements while the new template is being finalised.
She cited the recently concluded investment agreement with Saudi Arabia, saying it includes provisions that place greater emphasis on protecting investors from both sides.
India has also concluded investment agreements with the UAE, Oman and several Central Asian countries, she said.
The government is simultaneously negotiating similar agreements with countries including Canada and Russia.
Sitharaman said India could conclude agreements with at least three more countries by December if ongoing negotiations proceed as expected.
Talks with Canada, she added, could potentially be completed by December or early next year.
India's existing framework is based largely on the 2016 Model Bilateral Investment Treaty, which replaced an earlier model and subsequently guided the country's negotiations with foreign partners.
BITs are designed to provide protection to investors from one country when they invest in another. Such agreements can also allow investors to pursue arbitration against a host government in certain circumstances.
One of the most debated provisions in India's existing model is the five-year waiting period before a foreign investor can initiate treaty-based arbitration against India.
Under the provision, investors are required to first pursue remedies through domestic legal channels for five years before bringing a claim under the treaty.
The provision has faced criticism from investors and others seeking a shorter period for accessing international arbitration.
Sitharaman also pointed to the growing overseas investments by Indian companies as a reason for strengthening India's investment treaty network.
With Outward Direct Investment (ODI) from India expanding, the government is seeking greater protection for Indian companies and investors operating in foreign markets.
The Finance Minister said the 2016 framework no longer adequately addresses India's interests, making a new investment treaty template necessary.
The proposed template is expected to guide India's future bilateral investment negotiations once it receives Cabinet approval.