Bilateral investment treaties (BITs) have proved to be effective instruments in providing protection for foreign investors, but their role in contributing to economic growth and inclusive development in host states remains unclear. If BITs are to have a more pronounced impact on host states’ economic development, their underlying conceptualization could be reassessed and their provisions adapted to help tackle emerging economic, social and environmental concerns and more directly impact foreign direct investment (FDI) inflows. Despite the advent of what may be considered a new generation of treaties, BITs continue to fall short of proactively helping states achieve these objectives. First, their scope is narrow and their provisions are broad, covering investment protection without addressing the broader agenda of development policy necessary to a more inclusive economic growth model. Second, the nature of BIT provisions may deter host states from taking any actions or measures in the public interest that could be harmful to foreign investors. This can make it more challenging for states to implement new policies or reform existing ones in pursuit of economic growth and inclusive development. Third, BITs were traditionally designed not so much to increase FDI inflows into host countries, but rather to provide a stable and predictable legal framework for foreign investors. The absence of proactive investment promotion and facilitation provisions may have undermined their potential to increase FDI flows. In addition to these conceptual challenges, a number of more technical policy choices need to be addressed. For example, the definition of investment is all-encompassing and does not reflect any strategic investment policy priorities of the host state; the fair equitable treatment standard remains elusive despite recent attempts to clarify its meaning; “indirect” expropriation is open to broad and diverse interpretations; and the investor-state dispute settlement mechanism fails to provide sufficient consistency and predictability in arbitral awards. This paper proposes a selection of policy options to address some of the conceptual and substantive challenges of BITs with a view to making them more conducive to economic growth and more reflective of inclusive development policies.