INSOLVENCY AND BANKRUPTCY CODE, 2016: FRAMEWORK, IMPACT, AND REFORMS

Paper Number :WP53/2025
Publication Date :Aug. 11, 2025

This working paper examines the Insolvency and Bankruptcy Code, 2016 (IBC), a landmark legislation in India aimed at streamlining debt resolution and improving the recovery of non-performing assets (NPAs). The paper explores the evolution, implementation, and impact of the IBC, highlighting its role in addressing stressed assets, operational challenges in the Corporate Insolvency Resolution Process (CIRP) & liquidation, and policy gaps which are affecting the stakeholder interests. Key objectives of the paper include analysing the IBC’s legislative framework, assessing its effectiveness through case studies and performance metrics, and proposing reforms to enhance its efficiency and fairness further. The paper underscores the IBC’s transformative potential for banking professionals, regulators, and the Indian economy. It also aim to identify areas for improvement, such as the independence of insolvency professionals, equitable treatment of creditors, and procedural streamlining. Key takeaways include actionable policy recommendations to strengthen the IBC’s implementation and maximize asset recovery.