The Structural Paralysis of India’s Insolvency Regime
The National Company Law Tribunal continues to struggle under an overwhelming volume of legacy litigation, a factor that effectively nullifies the speed-oriented design of the Insolvency and Bankruptcy Code. The recent proposal by ICRA to bifurcate the insolvency process—creating a specialized, expedited track for smaller claims—is a direct response to the systemic failure of current mechanisms. While large-cap resolutions capture headlines, the daily operational capacity of the tribunal is being eroded by a backlog of micro-disputes that offer diminishing returns for creditors.
The Erosion of Recovery Efficiency
The financial reality of the current framework is stark. With 78% of…