Clearwater Capital is investing more than China in Indian distressed debt

Clearwater Capital Partners LLC says it is allocating more money into distressed debt in India as an increasing number of companies are dragged into insolvency proceedings.

“We have probably allocated more capital recently in India relative to China,” said Robert Petty, a co-founder at the Hong Kong-based fund specializing in direct lending, distressed and special situation opportunities in Asia.

A $2 billion bank fraud at Punjab National Bank and rising bankruptcy cases have rocked the South Asian nation this year, presenting new opportunities for hedge funds focusing on the latest fallout in banking and other key industries. Regulatory pressure for banks to