The legal sector in India, which has so far remained the exclusive domain of domestic practitioners, may be partially opened to foreign law firms. The Commerce Ministry is working on a proposal for a phased opening up of the sector in non-litigious services and international arbitration, a government official told BusinessLine .

It plans to discuss the matter with the Ministry of Law and Justice soon, following which it would hold inter-ministerial discussions and start work on a Cabinet note.

“The idea was discussed in detail at the recent National Services Conclave. We are giving finishing touches to a paper and will take it up with the legal department soon,” said a Commerce Ministry official who did not want to be identified.

But the Bar Council of India, which has so far been against the idea of liberalising the sector, will need to be convinced first. The Commerce Ministry expects Finance Minister Arun Jaitley’s backing to add weight to the proposal.

The paper proposes that foreign lawyers could be permitted to practise in India in conjunction with Indian lawyers, as a joint venture, with a cap on foreign participation.

After two-three years, advisory or non-litigious services in Indian law could be opened up, but a foreign lawyer would need to go through a pre-qualification examination in various aspects of Indian law.

With international trade and foreign investments rising, there is a growing need for advisers on a host of commercial, trade and investment issues, which could be opened up to foreign lawyers, the Ministry said.

In any case, foreign lawyers are working on disputes involving their companies through back-channels. “In the case of Japanese company Daiichi Sankyo’s dispute with former promoters of Ranbaxy, the company representatives would be accompanied by large contingents of Japanese lawyers who would do all the research and preparatory work.

“But they needed an Indian lawyer to represent them formally,” the official said.

India could get into bilateral arrangements with other countries to allow foreign lawyers to practise in limited areas in each other’s territories on a reciprocal basis.