India recently directed lenders to initiate bankruptcy proceedings against 12 of the biggest loan defaulters in an effort to clean up the countrys bad loan mess. But how effective will it be?
Last month, Indias central bank asked lenders to initiate bankruptcy proceedings against a dozen companies, including Essar Steel, Bhushan Steel Ltd, Monnet Ispat and Energy Ltd, according to sources interviewed by Reuters.
This followed a change enacted in laws in May that gave the Reserve Bank of India (RBI) greater power to address the $150 billion stressed loan problem plaguing growth in Asias third-largest economy.
While the RBI has yet to officially name any of the 12 companies, which account for about 2 trillion rupees ($31 billion) …
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