Current Affairs - Bills and Acts - Discussion

India enacted its first comprehensive bankruptcy law in 2016, marking a major shift in how financial distress and insolvency were handled. The law aimed to create a more structured, time-bound, and creditor-friendly insolvency resolution process, replacing the earlier fragmented systems. This legislation introduced a framework that enabled faster debt recovery, improved borrower behaviour, and enhanced credit discipline. Its impact has been profound—over 30,000 cases settled pre-admission, a notable reduction in debt costs for distressed firms, and improved governance. Identifying 2016 as the year of enactment is vital to understanding the chronology and evolution of insolvency reforms in India.