Over the next months, Indias newly-constituted bankruptcy courts will decide the fate of 12 companies that account for over a quarter of Rs 8 lakh crore worth of bad loans choking the banking system.
If the bankruptcy moved by Indias banks are accepted, companies with investments in factories, furnaces, trucks, textile looms, heavy equipment, and land will be placed under the supervision of their creditors, and given six months to strike a deal on their debt, failing which these firms will be liquidated.
You have this new law thats never been tried before, said the chief executive of one of these 12 companies. Maybe, you want to first try it out on a smaller company to see if it works?
The outcome of these cases will determine if the new in…
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