Liberalization of Indian legal services

Abstract

Services dominate the world economy today. In this increasingly globalized world several countries have liberalized their economies to integrate themselves with world markets, and the service sector has become increasingly important for their trade and investment flows. India is no different. In India, services alone contribute over 50% of the GDP. And various key sectors opening up such as telecommunications services has greatly facilitated India's penetration of world markets in IT and business support services. However legal services market still continues to operate in a closed style in India. And past decade has seen increasing pressure and debate over its opening up. This report tries answering the question of the need for liberalization of legal services in India. Starting with the introduction of Indian legal system the report goes on to cover the current market structure, Industry analysis and then offers a perspective of the current state of foreign legal firms in India. The report then moves from secondary data sources to describe the key findings of the primary interviews with various stake holders invovled in the issue. At this point the report discusses the various shortcomings in the current system and offers recommendations for the same. Shifting back to secondary data sources we present a case study of a recent example of liberalization in Asia Singapore. Based on Singapore s experiences we have come up with a phased implementation of liberalization of legal services. We then follow this up by comparing the legal education systems in India and Britain. This gives us information on the needed educational reforms. Having discussed a wide variety of issues we summarize the pros and cons involved with liberalization of legal services in India in a nutshell before presenting some of the policy recommendations that are suggested around to accomplish the task in a win-win style. We finally end up discussing the economic theories which need to be kept in mind while dealing with the concerned issue. We present a few possible game theory scenarios in the event of entry of possible firms. We believe that the next step to this report would be to develop a deeper economic understanding of liberalization of legal services.