International Conference on Insolvency, Bankruptcy: Minister says IBC has provided an effective ecosystem for insolvency resolution

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The first two-day international research conference on insolvency and bankruptcy co-organized by the Insolvency and Bankruptcy Board of India (IBBI) with the Indian Institute of Management Ahmedabad (IIMA) ended on Sunday.

Minister of State for Statistics and Program Implementation, Planning and Corporate Affairs, Rao Inderjit Singh, highlighted the journey of the Insolvency and Bankruptcy Act (IBC) of 2016 and commended the significant contribution it had made in creating a framework and an effective ecosystem for insolvency resolution in the economy.

According to a publication issued by IIMA, Singh quoted in his inaugural address that the code had taken on greater prominence during the Covid-19 pandemic and had been instrumental in saving both lives and livelihoods.

He also commended the extraordinary contributions made by the judiciary, government agencies, regulators and stakeholders in the IBC ecosystem in facilitating rapid and effective implementation of the Code.

He stressed that the introduction of the proposed cross-border insolvency resolution framework will be a milestone in redefining India’s business and economic ties with the rest of the world.

The two-day research conference took place under the auspices of the Misra Center of Financial Markets at IIMA. Other associated partners of the conference are the National Stock Exchange, the State Bank of India, the BSE Investors’ Protection Fund and the National Institute of Securities Markets.

Rajesh Verma, Secretary of the Ministry of Corporate Affairs (MCA), stressed the need to foster research culture in the regulatory framework. Referring to the Code’s achievements, he also highlighted that a comprehensive IT platform for Code processes is being worked on.

While Mr. Rajeshwar Rao, Deputy Governor of the Reserve Bank of India (RBI), highlighted the importance of timely resolution of stressed assets for the banking sector, Ravi Mital, Chairman of the IBBI, emphasized the importance of evidence-based research for policy making.

He stressed that time is of the essence of the Code and that all stakeholders should make fundamental research efforts to reduce delays at all stages of bankruptcy processing, starting with the identification of stress through to the final resolution.

Professor Errol D’Souza, Director of the IIMA, said: “Only a few months ago, the Parliamentary Standing Finance Committee had raised some questions about insolvency and bankruptcy. Some of the findings they reported were interesting and we thought this was a great opportunity to go back to the drawing board and think about what is happening in this very important part of the economy. This conference is a good time to do that.”

On the final day, panel discussions took place on reforms of the insolvency code, insolvency and bankruptcy settlement. The conference also included a workshop on data-driven insolvency research, aimed at providing researchers with comprehensive access to data currently available for such research and emerging future developments.

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