Back the IBC

A new mechanism will only kick the can down the road

The government is reportedly considering lifting the suspension of the Insolvency and Bankruptcy Code (IBC) to enable the resolution of stressed assets. It also plans to deal with stressed sectors differently. Restarting the IBC process will help resolve non-performing assets (NPAs) in the system and enable more efficient use of capital. In fact, an extended blanket suspension should have been avoided in the first place. The pandemic has affected the economy in multiple ways and will have a lasting impact on several businesses. Thus, it is important to have a mechanism to efficiently clean up the system. While the resumption