Speed and capacity

Restoring trust in IBC must be a priority

The Insolvency and Bankruptcy Code (IBC) is one of the biggest achievements of this government in the field of economic reform. When properly administered, the IBC increases financial flexibility and allows the speedy repurposing of capital that would otherwise have been locked up in unproductive projects. The Reserve Bank of India’s Trend and Progress in Banking Report for 2021-22, released this week, provides an opportune moment for reflection on how the IBC is doing when it comes to recovering value for financial creditors. It will be remembered that much of the bankruptcy mechanism was suspended for months during the pandemic.