Occupational Hazard
Business Today|August 26, 2018

THE INSOLVENCY AND BANKRUPTCY CODE CAN LEAD TO HUGE JOB LOSSES IN THE SHORT TO MEDIUM TERM AS MANY COMPANIES, INCLUDING SOME BIG NAMES, FACE LIQUIDATION.

Dipak Mondal
Occupational Hazard

DECCAN CHRONICLE HOLDINGS, the Hyderabad-based newspaper publisher, is fighting for survival in the National Company Law Tribunal (NCLT). With debt of around ₹8,000 crore, the company has been dragged to the NCLT under the Insolvency and Bankruptcy Code (IBC) and is now waiting for a bidder to save it from liquidation. “We have to ensure that this company survives or else 40,000 jobs, direct and indirect, could be in jeopardy,” says a source closely associated with the resolution process. Srei Group’s Vision India Fund, the only bidder left, has agreed to pay ₹1,000 crore and acquire the company. A resolution would mean that Deccan Chronicle is acquired by another group or promoter as a going concern.

The Insolvency and Bankruptcy Code, seen as a path-breaking reform, now poses a moral dilemma. While it has hastened the resolution process of many long pending corporate loan default cases, it has also led to a substantial number of companies getting liquidated in the absence of any takers for their business. This has, in turn, led to thousands of jobs coming under threat.

Many experts and resolution professionals believe that the IBC, by freeing up lakhs of crores of money stuck in long-pending corporate default cases, would lead to cleaning up of the mess and revival of many industries in the long run, there is no denying that jobs are being lost in the short to medium term.

Liquidation: A Hanging Sword

Liquidation remains a big threat to companies going through insolvency proceedings. Of the 968 cases of corporate default admitted by the NCLT for resolution under the IBC, close to 40 have been resolved and 156 have gone into liquidation. While many liquidated companies may not have been functioning, there are several instances of operational companies, with employees on rolls, getting liquidated.

この記事は Business Today の August 26, 2018 版に掲載されています。

7 日間の Magzter GOLD 無料トライアルを開始して、何千もの厳選されたプレミアム ストーリー、9,000 以上の雑誌や新聞にアクセスしてください。

この記事は Business Today の August 26, 2018 版に掲載されています。

7 日間の Magzter GOLD 無料トライアルを開始して、何千もの厳選されたプレミアム ストーリー、9,000 以上の雑誌や新聞にアクセスしてください。

BUSINESS TODAYのその他の記事すべて表示
"Focus on the challenge of each customer"
Business Today India

"Focus on the challenge of each customer"

SHASHANK KUMAR MD & CO-FOUNDER I RAZORPAY Razorpay is India's first full-stack financial solutions company

time-read
1 min  |
December 08, 2024
PEDAL ON THE FUTURE
Business Today India

PEDAL ON THE FUTURE

THE MG WINDSOR EV, WITH ITS FUTURISTIC AND MINIMALIST DESIGN, COMBINES THE BEST OF BOTH WORLDS-COMFORT AND TECHNOLOGY

time-read
1 min  |
December 08, 2024
BREATHE EASY
Business Today India

BREATHE EASY

Whether you're battling allergies, looking to remove pollutants, or simply want to breathe easier, the right air purifier can make a difference

time-read
2 分  |
December 08, 2024
The Taste of India in a Glass
Business Today India

The Taste of India in a Glass

FROM ROYAL LIQUEURS TO DISTILLED MAHUA, INDIAN HERITAGE ALCOHOLIC BEVERAGES ARE HAVING THEIR DAY IN THE SUN

time-read
4 分  |
December 08, 2024
LOOK BEFORE YOU LEAP
Business Today India

LOOK BEFORE YOU LEAP

IN 2025, INVESTORS WILL NEED TO FACTOR IN VOLATILITY ACROSS ASSET CLASSES

time-read
5 分  |
December 08, 2024
MISSING ADVISORS
Business Today India

MISSING ADVISORS

INDIA HAS JUST ONE INVESTMENT ADVISOR FOR NEARLY EVERY 200,000 INVESTORS. AT A TIME WHEN RETAIL PARTICIPATION IN THE STOCK MARKETS IS BOOMING, THIS ASSUMES SIGNIFICANCE

time-read
7 分  |
December 08, 2024
TURNING A CORNER
Business Today India

TURNING A CORNER

SHARED ELECTRIC MOBILITY START-UP YULU'S SHIFT TO SERVICING THE QUICK COMMERCE SECTOR IS HELPING IT GROW FAST. IT IS NOW FOCUSSING ON IMPROVING ROAD SAFETY FEATURES AS IT TURNS EBITDA POSITIVE

time-read
5 分  |
December 08, 2024
REALITY CHECK
Business Today India

REALITY CHECK

INDIAN STOCK MARKETS PLUNGED BEGINNING OCTOBER FOR A HOST OF REASONS, INCLUDING A FALL IN FII OWNERSHIP. HOW DEEP WILL THE CORRECTION BE?

time-read
6 分  |
December 08, 2024
TRUMP'S TRADE TANGO
Business Today India

TRUMP'S TRADE TANGO

The return of Donald Trump as the 47th President of the US has put the global economy on edge. India, too, is unlikely to remain unaffected. How will policymakers meet this latest challenge?

time-read
9 分  |
December 08, 2024
"The essence of the Trump administration will be transactional”
Business Today India

"The essence of the Trump administration will be transactional”

Global investor, analyst, and best-selling author Ruchir Sharma decodes why Donald Trump won the elections, what India should do, the risks, and more

time-read
10 分  |
December 08, 2024