Government may establish mediation council this year to improve ease of doing business: Report

The government focuses on improving the ease of doing business in India, which ranked 63 out of 190 countries in the World Bank's 2020 Doing Business Report.

The government may establish the Mediation Council of India (MCI) by the end of this year to enhance the ease of doing business in India, Mint reported. This will help settle disputes, particularly business-related, outside the court.

Mediation is when a mediator is appointed to help disputing parties reach an agreement outside the court.

Earlier this year, a committee appointed by the Insolvency and Bankruptcy Board of India (IBBI) had also recommended introducing a mediation framework which can be accessed voluntarily by disputing parties to resolve disputes and settle them faster out of courts.

This can also reduce the burden of cases on courts, just like how the government decriminalising over 100 various provisions of the law can do the same.

What is mediation?

Mediation is when a mediator is appointed to help disputing parties reach an agreement outside the court.

The Mediation Act which was passed last year mandates that mediation proceedings have to be completed within 180 days from starting. The MCI will be formed under this act.

Why does India need mediation?

India's rank in the World Bank's now-discontinued Doing Business Report was 63 out of 190 countries in 2020. India was ranked 163 in enforcing contracts, 154 in registering property, and 136 in starting a business.

The MCI will also take care of the training and certification of mediators through recognized institutes, the report read.

People currently opt for mediation only when mandated by the law, as in the case of the Commercial Court Act, 2015, which mandates parties to try mediation before entering courts, Namita Shah, co-founder of Presolv360, an online dispute resolution (ODR) forum providing e-mediation services, told Mint. The formation of the MCI will change this scenario and bring more parties to try mediation on their own will, and not because the law asked them to, she added.