Habiba Sheikh, LL.M., National Law University, Odisha
ABSTRACT
Over the last few years, the Indian banking sector has seen a number of changes. A massive increase in non-performing assets (“NPA”) was a major source of concern, putting banks, organizations, and individuals under extreme stress, resulting in a slew of concerns amongst the aforementioned parties. Consequently, the government of India enacted the Insolvency and Bankruptcy Code ("IBC" or "the Code") in 2016 to address this issue of growing NPAs. This move by the government of India has proven to be one of the most effective reforms, lauded not just by experts in India but also by international agencies such as the International Monetary Fund and World Bank.
However, the Indian Banking sector still has a long way to go for it to fully recover. Despite the fact that IBC has significantly reduced the amount of NPAs, some issues still loom large. This project aims to illustrate the background of IBC in light of the legislations that existed prior to its implementation, as well as the early transitional issues that IBC encountered. Further, an attempt is made to understand the role played by IBC in the resolution of NPAs, to analyze the effectiveness of IBC as a tool for reducing the issue of NPA.
Keywords: Insolvency and Bankruptcy Code, NPA resolution, Recovery of NPAs.
