Exploring New Age Trends and Challenges in ADR (India)

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Published On: 26th May 2025

Authored By: Kabir Sindhi
GLS UNIVERSITY

Abstract 

Alternative Dispute Resolution (ADR) in India is experiencing a significant transformation in the 21st century through tremendous changing of technology and method wherein it cannot escape specific challenges. This extensive analysis aims to understand the change of ADR in India by using the case of the merger of online mediation, arbitration based on artificial intelligence, and tailored alternative dispute resolution mechanisms in various corporate sectors. The study illustrates a lot of positive progress in mediation through the National Legal Services Authority that has been solving almost 650,000-800,000 cases up to 2025. The setting up of the India International Arbitration Centre – the IIAC – and the establishment of the Mediation Act 2023 are testaments of the country’s desire to strengthen its ADR framework. Presolv360 and Sama are technology platforms that transformed dispute resolution. Artificial Intelligence (AI) and blockchain has potential to succeed in arbitration processes but they are still in the trial phase. However, the issues remain large: expenses, an uneven geographical distribution of the ADR services, public unawareness, and lack of qualified professionals. The research identifies the areas which are the main ones to improve, such as regulatory oversight, professional training, as well as public education about ADR mechanisms. The analysis provides that while India has achieved considerable progress in the application of ADR, systematic changes and capacity building are indubitably necessary to form a more efficient, accessible, and just dispute resolution system.

Introduction  

The 21st century has seen the birth of an entirely new way of dealing with conflicts known as Alternative Dispute Resolution (ADR). Online mediation, Al-driven arbitration, and upcoming dispute resolution for sectors such as technology and healthcare have increased the versatility and accessibility of ADR. Consider being in the middle of an international business dispute while being settled from the comfort of your home. Believe it or not, it’s already happening! Nevertheless, this vibrant progress is confronted by obstacles: success in strong result enforcement across boundaries, the adoption of a set of norms and the robotic world haunting of moral axioms. 

The most advanced trends and the problems they pose, providing a glimpse into how ADR can remain a success story of efficiency, fairness and justice in the 21st century for the resolution of disputes.

This article explores recent trends and challenges in India in the field of ADR, with an eye towards shaping the future of dispute resolution in India.

1) India’s ADR Landscape: The Catching Up with Global Leaders  

Alternative Dispute Resolution (ADR)—which encompasses arbitration, mediation, conciliation and negotiation—offers a notable alternative to traditional court proceedings. India, however, despite having developed extensive arbitration legislation, faces challenges in providing equivalent legal support for mediation, an approach that is increasingly gaining popularity.

Comparing India’s ADR system with Singapore‘s advanced arbitration process highlights the advantages and difficulties of each. Singapore has a highly organized system for rules and laws, especially in international arbitration. This draws in foreign investments but also complicates dispute resolution. 

On the other hand, the United States uses a flexible method for mediation and arbitration, focusing on adaptability and enforcement. This shows how different legal systems can successfully handle conflicts. In India, the main challenge is balancing the independence of ADR with the possibility of judicial involvement. This is an important topic that needs thorough examination.

2) Current Trends in ADR

2.1) Mediation: A Rising Star

Mediation has become an important tool for easing the workload of Indian courts. The National Legal Services Authority (NALSA) has been very important in setting up mediation programs it is estimated that around 650,000 to 800,000 cases have been settled through these programs as of March 2025. This number comes from reports by the National Legal Services Authority (NLSA), which indicate that from 2017 to 2022, about 650,000 cases were settled, with likely additional cases in the following years given the trend of increasing mediation usage.

For example, based on the information available, from 2023 to 2024, the mediation centre at the Gujarat High Court successfully settled over 2000 cases.[1] Government efforts have increased the use of mediation, especially in disputes involving the public sector, family issues, and labour problems.

Recent developments in ADR in India include the establishment of the India International

Arbitration Centre (IIAC) in 2022, the operationalization of the Arbitration Council of India in 2023, and the Mediation Bill of 2021, all aimed at promoting institutional arbitration and mediation 

Arbitration and Conciliation Bill, 2019 (“the Amendment Bill”). The bill is a step forward and is reflective of the legislative intent to encourage institutional arbitration for settlement of disputes and to make India an advanced centre of ADR.

With the Mediation Act 2023 comes an era of mediation, with a robust framework, practices and enforceability of settlements. Two decades have seen Legislative backing catapult mediation onto the world stage as the preferred method for dispute resolution, especially in the areas of family affairs, labour and public sector disputes.

2.2) International Arbitration: India’s Global Ambitions

India’s growing role in the global economy has resulted in a rise in international arbitration cases involving Indian entities. For instance, according to the International Chamber of

Commerce (ICC), Indian companies were involved in approximately 300 cases at the

Singapore International Arbitration Centre (SIAC).[2]

The India International Arbitration Centre (IIAC) [3]was established in 2019 by an Act of Parliament, known as the India International Arbitration Centre Act, 2019. The purpose of this initiative was to create an independent and autonomous regime for institutional arbitration in India. The IIAC has been declared an institution of national importance, aiming to provide a neutral dispute resolution platform for both domestic and international commercial disputes

2.3) Technology: The Game Changer

In dispute resolution, technology is revolutionizing India. Given the COVID-19 pandemic, online Dispute Resolution (ODR) platforms have become popular. Leading the charge is platforms like Presolv360, Credgenics and Sama, while Sama has found the case has been resolved over more than 34 lakhs disputes.[4]

In the future of arbitration, Artificial Intelligence (AI) play an important role. As per the BCLP International Arbitration Survey 2023[5], 70 per cent of Indian arbitration practitioners anticipate that AI will be essential in the coming years, thereby automating process and enhancing accuracy. 

The breakthrough in Artificial Intelligence (AI) that has played a significant part in the field of ADR is the in-depth analysis of case histories and the prediction of outcomes, which in turn has accelerated the decision-making processes. Also, the Blockchain technology is instrumental in upholding integrity and security in ADR by enabling the parties to secure ownership of data and the agreements they make[6] Webnyay[7] is a secure and efficient online platform, where there are flexible, economical services for resolving disputes online and it has been successfully turned into a trustworthy system for resolving grievances online.

3) Challenges and Solutions Related to ADR[8]

1)   Progress of ADR 

  • Challenge – The progress of ADR in India is obstructed by the lack of basic government assistance and infrastructure especially in small cities and towns, do not have ADR centres due to which parties are often have to visit bigger cities for dispute settlement.
  • Solution – Establishment of ADR centres in every district can be the way to improve the accessibility and reduce the costs of the parties. The government should finance these initiatives and view ADR as a preferable conflict solution method.

2)   Training  

  • Challenge – A critical area of concern is the unavailability of trained arbitrators, mediators, and conciliators in India since the specialized training programs are not offered regularly.
  • Solution – Establishment of fully equipped training programs for the legal professionals will be to raise their adaptability to ADR, since in this way, resolution of disputes will be more successful legal. At a time, lawyers, judges, and ordinary people can benefit from these initiatives. Programs involving active educations and capacity building are also needed to disseminate knowledge and skills about ADR

3)  Awareness  

  • Challenge- Many people would rather opt for the traditional judicial system than choose ADR; the lack of awareness and trust in the new methods is the main reason. The conventional mindset of the society generally tilts towards the legal system, making it difficult for ADRs to be broadly accepted.
  • Solution – The public awareness campaigns and legal education programs are essential the rest of the society to follow suit. The legal course as valuable content delivered to children during their school days can be a great source of awareness and credibility for ADR. This helps them accept and use these mechanisms of dispute resolutions

4) Technology  

  • Challenge – Using outdated technology, limited connectivity, and insufficient technical skills ensures data security and privacy.
  • Solution – Applying modern technological systems to the ADR procedures can help to decrease the time factor, ensure the transparent nature of the processes, and increase their effectiveness. Digital communication tools, like video conferencing or webbased tools, can empower customers by enhancing mediation, international commercial disputes, and boosting the existing business framework

5) Challenges:

The digital divide of ODR: Are we leaving some people behind? There are increasing concerns in relation to equitable access to (ODR) and that access to justice through ODR, may be marginalising those who do not have access to reliable internet or have digital literacy. And of course, the more distant medium of online interaction can make the development of the trust that is so crucial in mediation rather more challenging. Maintaining data security, handling biases in case the AI powered arbitration algorithm and blockchain technology, are the thought-provoking challenges.

Solutions:

Need high priority regulation. Such regulation is crucial to improve equitable access and digital inclusion, enhance data security, address potential algorithmic biases, and foster trust, thereby bringing fairness and public acceptance in these novel methods for digital resolution.

4) Case Studies in Indian ADR

1) Online Mediation in Family Disputes during COVID-19 The Delhi High Court 

During the COVID-19 pandemic, the Delhi High Court approved and implemented online mediation sessions via its ‘Samadhan’ centre, illustrating ODR’s adaptability in continuing dispute resolution services, particularly for family law cases, amidst physical restrictions. [9]It was discovered that the utility of video conferencing platforms enabled 86.56% at the Tis

Hazari Courts (2015-2021) to be disposed of in 15 minutes.[10]

  • Koodankulam Nuclear Power Plant Environmental Disputes [11]This is a case between NPCIL, and local communities where they were mediated for environmental and safety issues at the Tamil Nadu nuclear power plant. The case was in the limelight for the following:
    • Multi-stakeholder dispute complexity
    • Balancing between development and environmental preservation
    • The community-based mediation approach is essential to resolving the issue
  • ADR in Intellectual Property Disputes[12] Rise in the technology sector disputes translates into an increase in the number of ADR cases in the IP conflicts, using the WIPO Arbitration and Mediation Centre the case is mainly that. Among the main topics are:
    • Software copyright and patent infringement focus
    • Speed of resolution in the tech sector and pharmaceutical sectors
    • IP rights arbitrability instances
  • RBI’s policy on Online Dispute Resolution (ODR) for digital payments. Taking note of the increasing volume of digital transactions and the redressal mechanisms, the RBI had directed the Payment System Operators to adopt ODR systems with an initial focus on failed transactions, with effect from January 1, 2021.13 This ground-breaking intervention offers Indian consumers a convenient technology-driven platform for swift redressal of payment related grievances, highlighting the increasing contribution to consumer interest and confidence in the dynamic digital economy of India Played by ADR. This shift demonstrates the practical progression of ODR theory being used to solve real world issues in high volume sectors.

5) Conclusion

The future of Alternative Dispute Resolution (ADR) in India is contingent of both exciting opportunities and even greater challenges. Incorporation of mediation and international arbitration is making the dispute resolution framework faster, cheaper than cross litigation. But lack of awareness, high costs and shortage of professional training has made wider adoption difficult. 

Improvements of the effectiveness of ADR call for comprehensive legislative reforms, public awareness about the usage of ADR, and standardized training of the practitioners. However, regulatory bodies will also be strengthening to ensure ADR processes remain both efficient and have strict standards of integrity. India stands at a pivotal moment to implement reforms in its justice delivery system, creating an environment where all individuals and businesses can access justice.

Reference 

[1] National Legal Services Authority (NALSA), ‘Settlement through Mediation Report’

(NALSA) https://nalsa.gov.in/statistics/settlement–through–mediation–report accessed 12 March 2025

[2] Freshfields Bruckhaus Deringer LLP, ‘India: A New Era for International

Arbitration?’ https://www.freshfields.com/ accessed 7 March 2025  

[3] Indian International Arbitration Centre (IIAC), ‘About | Arbitration’ (IIAC) https://www.indiaiac.org/aboutarbitration accessed 7 March 2025

[4] Sama, ‘Resolve Disputes Online’ (Sama.live) https://www.sama.live/ accessed 10 March 2025

[5] Bryan Cave Leighton Paisner, ‘Artificial Intelligence – the Rise of Machine Learning’ (BCLP International Arbitration Survey 2023, 24 July 2023) https://www.bclplaw.com/en–US/events–insights–news/ai–in–ia–the–riseof–machine–learning.html?form=MG0AV3 accessed 10 March 2025

[6] CS (Prof.) (Dr.) D. Mukhopadhyay, ‘Alternate Dispute Resolution: Impact of AI and Digitization with Reference to Indian and Global Practices and Perspectives: An Empirical Study’ (January

2025) https://www.icsi.edu/media/webmodules/CSJ/January–2025/28.pdf accessed 13 March 2025.

[7] Webnyay, ‘Resolve Complaints And Disputes Outside Court’ (Webnyay) https://www.webnyay.in/

[8] iPleaders Blog, ‘An Overview of Challenges in ADR Mechanism in India’

(iPleaders) https://blog.ipleaders.in/an–overview–of–challenges–in–adr–mechanism–inindia/#Major_challenges_in_ADR_mechanism_in_India

[9] HC approves online meditation sessions via video conferencing during COVID-19,” The Economic Times, June 26, 2020. Accessed April 24, 2025. https://m.economictimes.com/news/india/hc–approves–online–meditationsessions–via–video–conferencing–during–covid–19/articleshow/76646540.cms

[10] Jayashima S and Paspulate A, ‘Law on Mediation in India and its Recent Developments’ (International Bar Association, 20 December 2021) https://www.ibanet.org/law–on–mediation–in–India–and–its–recentdevelopments

[11] Kudankulam Nuclear Power Plant’

(Wikipedia) https://en.wikipedia.org/wiki/Kudankulam_Nuclear_Power_Plant

[12] Gupta S, ‘Alternative Dispute Resolution and the Law of Intellectual Property’

(iPleaders) https://blog.ipleaders.in/alternative–dispute–resolution–and–the–law–of–intellectual–property/ 13 Reserve Bank of India, “Online Dispute Resolution (ODR) System for Digital Payments,” Notification DPSS.CO.PD No.629/02.01.014/2020-21, August 6, 2020. Accessed April 24, 2025. https://www.rbi.org.in/CommonPerson/english/scripts/Notification.aspx?Id=3194

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