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Union Minister for Finance and Corporate Affairs Nirmala Sitharaman with Minister of Foreign Affairs of Kyrgyzstan Zheenbek Kulubaev Moldokanovich during signing of the Bilateral Investment Treaty between India and Kyrgyzstan, in New Delhi, June 5, 2025.
Finance Minister Nirmala Sitharaman and Kyrgyz Foreign Affairs Minister Zheenbek Kulubaev Moldokanovich on Thursday signed a protocol for enforcement of a bilateral investment treaty to foster bilateral economic relations and encourage cross-border investments between the two nations.
The Bilateral Investment Treaty (BIT) signed on June 14, 2019, in Bishkek, between the Government of India and the Government of the Kyrgyz Republic, enters into force, with effect from June 5, 2025.
This new BIT replaces the earlier agreement enforced on May 12, 2000, ensuring continuity in the protection of investments between the two nations, the finance ministry said in a statement.
“The India-Kyrgyz BIT marks a significant milestone in strengthening bilateral economic relations and fostering a secure and predictable investment environment. The BIT aims to promote and protect the interests of investors of either country in the territory of the other country,” it added.
Some of the key features of the BIT include an emphasis on sustainable development in the preamble and removal of the most favoured nation (MFN) tag.
“The BIT contains two types of exceptions: general exceptions and security exceptions. The attempt is to carve out a policy space for the State. The general exceptions include, among others, the protection of the environment, ensuring public health and safety, and protecting public morals and public order,” it said.
The BIT has calibrated the Investor-State Dispute Settlement mechanism with mandatory exhaustion of local remedies, thereby, providing investors alternate dispute resolution mechanism, it noted.
Another key feature of the BIT is the exclusion of matters relating to local government, taxation, government procurement, services supplied in the exercise of governmental authority, and compulsory licenses, in order to retain sufficient policy space with the government in such matters, it said.
The treaty balances the investor rights with the sovereign regulatory powers of both countries and reflects a shared commitment to create a resilient and transparent investment climate, the statement added.
It is expected to further encourage cross-border investments and deepen economic cooperation between India and Kyrgyzstan.
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Published on June 5, 2025
This article first appeared on The Hindu Business Line
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