Speaking at an online seminar orchestrated by the Confederation of Indian Industry (CII), Krishnamurthy Subramaniam, the Chief Economic Advisor, applauded the efforts put in fighting feudalism out of the country’s economic fabric, with the implementation of the Insolvency and Bankruptcy Code (IBC) in 2016. He also hinted at how few stakeholders scuttle the outcomes of the IBC in efforts to benefit themselves.
Citing the concept of Dharma, derived from the ancient literature of Bhagavad Gita, Subramaniam stressed on shifting from the “I, Me, and Myself” perspective to one that is “socially optimal.” He stated how he disliked the word ‘practical,’ and the word that really inspires him is ‘ideal.’ “From an economic angle, the concept of Dharma is much powerful than it seems. It denotes that there is a much bigger goal. It aspires people to do what is socially optimal,” he said.
Subramaniam pointed at the fact that IBC allows actions that are favourable and benefits the entire IBC system; however, stakeholders prefer the execution of actions that are privately optimal for them. “The resilience to take actions that benefit them rather than the whole system results in a rigid equilibrium that doesn’t allow growth. We get stuck where we are,” he said, according to The Hindu report.
The event organized by CII was based on commemorating five years of the Insolvency and Bankruptcy Code, 2016, and the way forward with the novel law. The statements given by the CEA come in the wake of multiple cases of highly depraved cuts grabbed by the lenders in cases of a few bankrupt organizations.
According to HT report, Jayant Sinha, Bhartiya Janta Party leader and the chairman of the parliamentary standing committee on finance, also expressed concerns over the issue and stressed on the need for a code of conduct for lenders dealing with bankruptcy proceedings.
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