Skip to content
Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Primary Menu Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us
  • Featured

India To Privatise State-Run Companies & Halt Fresh Insolvencies

May 18, 2020 | Pratirodh Bureau

FILE PHOTO: Finance Minister Nirmala Sitharaman

India said on Sunday it would privatise state-run companies in non-strategic sectors and stop fresh insolvency cases for a year, as the country battles with the economic fallout from the coronavirus pandemic.

A list of strategic sectors will also be announced in which only one to four public sector enterprises will remain, Finance Minister Nirmala Sitharaman said, as part of a slew of measures to kickstart the economy.

Indian officials said most of the privatisations would happen in the next fiscal year, starting April 2021.

India has been trying to divest parts of state-run companies in sectors ranging from aviation to power to fill its coffers, but it has confronted weak investor sentiment and limited demand.

“Such measures have to be done at times the government can get the right price,” said Shriram Subramanian, founder of proxy advisory firm InGovern, adding that the intention was good.

He said that in order to attract private investors, the government needed to improve the efficiency of state-run companies by freeing boards from interference by bureaucrats and “shed lot of flab” by cutting their labour force and hiring the right talent.

The government’s revenues have been hit hard as a nationwide lockdown imposed in March to prevent the spread of the novel coronavirus has ground the economy, Asia’s third largest, to a halt.

The finances of Indian states have also been tipped into disarray, barring a few well-managed ones, because of the losses of tax revenues from fuel to stamp duties.

Indian states would be allowed to borrow 5% of their gross domestic product, up from 3% earlier, Sitharaman said on Sunday, adding that it would allow states to raise an additional Rs 4.28 trillion ($56.45 billion) in the year ending March 2021.

“(The move) will help to absorb the expected plunge in their revenue receipts, and avoid a severe cutback in capital expenditure,” said Jayanta Roy, group head of corporate sector rating at ICRA.

DEBT RECOVERY

The minister also said no fresh insolvency cases would be initiated for up to a year, in a move to avoid a wave of bankruptcies from companies hit by the coronavirus outbreak.

Debt incurred by companies due to the economic fallout of the coronavirus outbreak would not be considered a default under the country’s Insolvency and Bankruptcy Code (IBC), she added.

Introduced in 2016 to address India’s burgeoning bad loans, the code helped lenders and operational creditors drag defaulters to court, which in some cases even led to promoters losing control over their companies.

“Lenders will certainly become more cautious now, considering the impact IBC had on debt recovery, and the fact that debt recovery through IBC will be restricted for at least the next one year,” said Atul Pandey, a partner at law firm Khaitan & Co.

Sitharaman said a special insolvency resolution framework for micro, small and medium enterprises would be brought in soon.

Tags: coronavirus pandemic, Finance Minister Nirmala Sitharaman, IBC, Insolvency and Bankruptcy Code, nationwide lockdown, non-strategic sectors, Pratirodh, state-run companies

Continue Reading

Previous India Extends Lockdown To May 31, To Relax Rules In Some Areas
Next Why India’s Migrant Labourers Fill Me With Hope

More Stories

  • Featured

Floods In Assam Lead To Massive Destruction, Cripple Life

2 hours ago Pratirodh Bureau
  • Featured

Delhi HC Notice To Police On Zubair’s Plea

3 hours ago Pratirodh Bureau
  • Featured

‘Why Different Treatment For Farmers & Large Businesses?’

19 hours ago Pratirodh Bureau

Recent Posts

  • Floods In Assam Lead To Massive Destruction, Cripple Life
  • Delhi HC Notice To Police On Zubair’s Plea
  • ‘Why Different Treatment For Farmers & Large Businesses?’
  • Ban On Single-Use Plastic Items Kicks In
  • Improving Road Safety Could Save 30K Lives In India Annually: Study
  • At What Point Is A Disease Deemed To Be A Global Threat?
  • Twitter Accounts Linked To The Farm Movement Withheld: SKM
  • ‘Pandemic Is Changing But It Is Not Over’
  • Chopra Set To Win Medal In Stockholm Event
  • Bonn Climate Talks End In ‘Empty Pages’
  • Civilian Deaths In Russia-Ukraine Conflict Very Disturbing: India
  • Kanhaiya Lal Went To Police Claiming Threat To His Life
  • ‘Journalists Shouldn’t Be Jailed For What They Write, Tweet, Say’
  • ‘Muslims Will Never Allow Taliban Mindset To Surface In India’
  • Recording Mangrove Damage From Cyclones In The Sundarbans
  • Editors’ Guild Condemns Mohd Zubair’s Arrest
  • US SC’s Abortion Verdict Reverses Decades Of Progress: Activists
  • JNUTA, Others Demand Teesta’s Release
  • SC Nod To Hear Plea Alleging Hate Crimes
  • SIO Condemns Teesta’s Arrest By Guj Police

Search

Main Links

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us

Related Stroy

  • Featured

Floods In Assam Lead To Massive Destruction, Cripple Life

2 hours ago Pratirodh Bureau
  • Featured

Delhi HC Notice To Police On Zubair’s Plea

3 hours ago Pratirodh Bureau
  • Featured

‘Why Different Treatment For Farmers & Large Businesses?’

19 hours ago Pratirodh Bureau
  • Featured

Ban On Single-Use Plastic Items Kicks In

19 hours ago Pratirodh Bureau
  • Featured

Improving Road Safety Could Save 30K Lives In India Annually: Study

1 day ago Pratirodh Bureau

Recent Posts

  • Floods In Assam Lead To Massive Destruction, Cripple Life
  • Delhi HC Notice To Police On Zubair’s Plea
  • ‘Why Different Treatment For Farmers & Large Businesses?’
  • Ban On Single-Use Plastic Items Kicks In
  • Improving Road Safety Could Save 30K Lives In India Annually: Study
Copyright © All rights reserved. | CoverNews by AF themes.