Insolvency and bankruptcy code (IBC) suspension extended till March 31 – The Economic Times

Clipped from: https://economictimes.indiatimes.com/news/economy/policy/insolvency-and-bankruptcy-code-ibc-suspension-extended-till-march-31/articleshow/79843895.cms?utm_source=ETTopNews&utm_medium=HPTN&utm_campaign=AL1&utm_content=23Synopsis

The government had suspended fresh proceedings under IBC for loan defaults on or after March 25, for six months, as part of measures to provide relief to the industry due to the pandemic. India had announced its first nationwide lockdown on March 25, and relief measures including several compliance relaxations and extensions were announced soon after.

Suspension of the insolvency and bankruptcy code (IBC) is being extended till March 31, 2021, finance minister Nirmala Sitharaman said at the Bangalore Chamber of Industry and Commerce virtual conference Monday.

“Even the suspension of the IBC has been postponed even further from 25th of December… we’ve moved to say that it can be up to 31st March 2021,” she said.

Sitharaman backed the suspension of IBC for nearly the full year since every industry had gone through major stress because of the pandemic.

“So the entire year has had the IBC suspended, and rightly so, because every industry has gone through major stress because of the pandemic and nobody could be drawn the words insolvency which may have occurred during the pandemic,” Sitharaman said at the session with the industry in the preparations to the Union Budget.

The government had suspended fresh proceedings under IBC for loan defaults on or after March 25, for six months, as part of measures to provide relief to the industry due to the pandemic. India had announced its first nationwide lockdown on March 25, and relief measures including several compliance relaxations and extensions were announced soon after. The end-date of suspending Sections 7, 9 and 10 of IBC was further extended by three months till December 25.

She added that the government through subordinated assistance of banks had hand held industry through the emergency credit liquidity guarantees and partial guarantee scheme, which benefited the micro, small and medium scale enterprises (MSMEs).

She also sought inputs from industry on the benefits of artificial intelligence (AI), big data and automation for MSMEs and the steps that the government should take to help in the transition as companies reset themselves post Covid.

“Anything new, anything different, anything out of the box that has to be done, will also have to emanate from people like you who are working in the ground,” she said, noting that the adaptation of technology, automation and benefiting from big data would be necessary for small and medium industries and not just restricted to big industries.

Sitharaman pointed out that India should be at the centre of taking advantage of its large pool of soft skills related to AI, robotics and big data management, which can benefit the country’s economic recovery in FY 2021-22.

“We should also have our people who are now masters in artificial intelligence for now masters in soft skills related to robotics, or even big data management to help us so that our reset post the COVID benefits from such technology benefits,” she said.

During the session, industry suggested top global firms be invited to become anchor investors in priority sectors that can bring innovation and technology practice sectors.

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