Arbitration case: Cairn Energy offers to invest $1.2 bn if India relents

 Cairn Energy has offered to invest the entire award money in India, which includes the principal amount of $1.2 billion and interest of $500 million if the government agrees to enforce the award

As the tax battle intensifies between India and energy giant Cairn, with New Delhi challenging the $1.2-billion award at The Hague, the UK oil major has reached out to the Indian government through informal channels with a fresh proposal to settle the dispute, though with dim prospects of success.
Cairn Energy has offered to invest the entire award money in India, which includes the principal amount of $1.2 billion and interest of $500 million if the government agrees to enforce the award.
However, the government is unlikely to accede to the proposal, arguing that it would mean accepting the verdict, against which it has appealed.
“There is no way that the government is going to accept the proposal. We have filed an appeal. Any solution will be within the legal framework. For that, we have asked them to come under the Vivid Se Vishwas (VSV) scheme and settle the dispute by paying 50 percent of the disputed principal tax amount and get a waiver of interest and penalty. That would have resulted in an immediate refund of $300 million,” said a government official.
In fact, the government is still open to settling the dispute by accommodating the oil major under VsV direct tax dispute resolution scheme, the declaration window for which officially closed on March 31. The payment window closes on April 30.
Another official pointed out with international arbitration, it was difficult for Cairn to invest in India.