Fitch Ratings expects India’s new Insolvency and Bankruptcy Code to improve the environment for creditors over the medium to long term, although effective implementation will be key. The bill once it becomes law will replace the multiple laws applicable for insolvency and bankruptcy, and allow speedier and harder deadlines for resolving corporate insolvency, which should help in strengthening creditor and investor confidence in the long term.
The bill, which was cleared by both houses of Parliament within one week, reflects the government’s sense of urgency in improving the resolution process. The code’s proposed 180-day time frame for recovering bad debts (and extendable by 90 days) is ambitious but nonetheless a critical st…
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