A Bilateral Investment Treaty is established through a formal agreement and sets out the terms and conditions for private investment between entities of two countries. The objective of BITs is to protect the investments made into the host country. Through imposing certain restrictions on the regulatory set up of the host country, BITs seek to protect the rights of the investor from any unreasonable interference. Beginning from November 25, 1959, when the first BIT was signed between Germany and Pakistan, till date, BITs have acted as a rather significant factor in shaping the foreign investment policy of many countries and the way investment and trade takes place amongst them.

This research concerns itself with the study and analysis of the Bilateral Investment Treaties, their growth and development through periods of economic and political instabilities and their impact on shaping the global economies such as Japan and France. The paper also focuses on the growth and development of BITs from the perspective of Indian economy, analysing important development in this regard and then proceeds to elaborate upon the outlook of the Courts, both domestic and International, in cases of dispute under such treaties.

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