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While the Insolvency and Bankruptcy Code (IBC) has successfully chartered a new era in the history of bankruptcy resolution in India, it needs reform in order to speed up resolution and recovery from insolvency firms. Analyse.

Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.

4. While the Insolvency and Bankruptcy Code (IBC) has successfully chartered a new era in the history of bankruptcy resolution in India, it needs reform in order to speed up resolution and recovery from insolvency firms. Analyse. (250 words)

Difficulty level: Moderate

Reference: Live MintInsights on India

Why the question:

As the Narendra Modi government celebrates “Azadi ka Amrit Mahotsav”, an initiative to commemorate 75 years of independence, it is worth assessing the success of India’s bankruptcy code, which is arguably one of the most progressive commercial laws brought into force in recent times by the country, providing companies with the “freedom of exit”.

Key Demand of the question:

To write about the successes of IBC and reforms needed in it to make it more holistic.

Directive word: 

Analyse – When asked to analyse, you must examine methodically the structure or nature of the topic by separating it into component parts and present them in a summary.

Structure of the answer:

Introduction: 

Begin by writing about Insolvency and Bankruptcy Code (IBC) its aims and objectives.

Body:

First, list down the various features and achievements of IBC since its introduction.

Next, write about the various limitations in the performance of IBC.

Next, write about the reform that is needed to ensure that IBC performance leads to strengthening of its supporting role in capital formation and economic growth of the country.

Conclusion:

Conclude with a way forward.