Faster justice can lift investment, speed up India’s economy

The pipeline itself has thickened. Between 2020 and 2024, total pendency rose by nearly 20%.

What is perhaps less well known is that the rate of case disposal is quite impressive. Case-clearance rates (CCRs) in 2024 touched 94% in high courts, while a handful of courts achieved a CCR greater than 100% for three straight years.

This indicates that the process reforms done so far have ensured that the incremental case load gets processed more efficiently. But the long-tail dominates the system’s dynamics. A big share of the docket is more than 3 years old, so even decent annual CCRs don’t shrink the backlog.

This leads us to the second symptom: high judicial vacancies. These stand at 33% in high courts and 21% in district courts, while other staff vacancies climbed to 27%. If the system is clearing 90-100% incremental cases with an average vacancy rate of 24%, it means that with all positions filled, it can start cutting into the backlog significantly.

That points to the third symptom of severe under-capacity. It is a problem of structural design. India has only 15 judges per million population, far below the 50 recommended by the 1987 Law Commission’s benchmark. In comparison, Germany has 247 and France 113. Even England, which has the lowest in Europe, has 33.

Workloads reflect this under-capacity. By the end of 2024, most high courts had more than 1,000 cases per judge—the Allahabad and Madhya Pradesh high courts had about 15,000. In district courts, the average was about 2,200 cases per judge.

The fourth symptom is massive under- spending. States on average spend only 0.59% of their budget on the judiciary. The national per capita spending is merely ₹182. This translates to courtroom shortages, poor IT support and too few court managers, stenographers and process servers.

By contrast, India’s per capita spending on physical infrastructure is close to ₹15,000. The judiciary is part of our economic and social infrastructure and so needs to be fast and fair. But it is under-built and hopelessly overburdened.

No wonder people dread going to courts, fearing infinite delays. Stories of disputes and litigation spanning generations are common. As made famous by a Hindi movie, in courts, all you seem to get is “taareekh pe taareekh” (hearing dates). Let us not discuss the role of cunning lawyers in such delays here.

The fate of undertrials in jails is worse. Nearly 70% of the roughly half-million people in Indian prisons are undertrials. They are technically innocent (until proven guilty in a court trial). But 40% spend at least six months before being released on bail. Quite a few undertrials remain in jail for periods longer than the maximum sentence they would get even if convicted.

Some recent headlines of high-profile cases don’t inspire confidence. For instance, a terror trial running for 19 years ending with reversals or long-running scams ending in sweeping acquittals. These tell investors and citizens that finality takes too long and interim orders can last forever.

Even if each case turns on facts, the macro-signal is powerful: litigation risk is high, timelines are uncertain and enforcement is negotiable. This reputational discount shows up in investment committee assessments as “India execution risk.”

What hurts India the most in composite ease-of-doing-business assessments is the time taken in dispute resolution. Weak enforcement increases the risk premia and hurdle rate for investments. Working capital gets locked in receivables from disputes, arbitration awards and tax refund delays, while litigation hogs managerial bandwidth. Judicial delays and uncertain enforcement become barriers to entry as incumbents with deep pockets get an edge.

We must fill up judicial vacancies fast. Also, fund the judiciary as core infrastructure, allocating it at least 1% of all state budgets. Apart from other amenities, we need full e-filing and paperless records, audio-video recording and transcription services and extensive AI use for scheduling and other processes.

Reforms should aim at reducing the backlog, and not just a 100% CCR. Alternate dispute resolution also needs to be strengthened. As the state is the biggest litigant, this matters the most for government cases. Departments must have mediation targets and a ‘settle-or-explain’ rule before filing appeals, especially if the sums involved are low .

Finally, justice is a public service, like the police and healthcare. The judiciary must serve the public and deliver vital services. Yet, the judicial service is fundamentally distinct from other public services. Not only must it protect rights, its judges hold sovereign judicial power, placing them alongside ministers and legislators (rather than executive office-holders or the technical staff of other public services); judges have distinct duties as well as restrictions that extend after their retirement.

Above all, the judiciary is independent of the executive and legislature under the Constitution. This key difference must be kept in mind as we undertake judicial reforms for faster dispute resolution, less enforcement uncertainty and predictable adherence to the rule of law—which should spell greater investment and faster growth.

The author is senior fellow with Pune International Centre.