Parliament Approves Insolvency and Bankruptcy Code (Amendment) Bill, 2026 During Budget Session

During a session in the Rajya Sabha, Finance Minister Nirmala Sitharaman stated that the Insolvency and Bankruptcy Code (IBC) has played a significant role in enhancing the health of the Indian banking sector. Sitharaman highlighted that the IBC has facilitated the recovery of assets for creditors, thereby strengthening the financial position of banks.

In a parallel legislative endeavor, the Lok Sabha is currently discussing the Jan Vishwas (Amendment of Provisions) Bill, 2026. This bill aims to improve the ease of doing business by amending certain provisions to foster a more investor-friendly environment in India. The discussions reflect the governments ongoing efforts to bolster economic resilience and promote transparency in insolvency proceedings.

The Insolvency and Bankruptcy Code, enacted in 2016, was designed to provide a systematic and time-bound process for resolving insolvency issues, thereby mitigating financial distress among businesses and enhancing recovery rates for lenders. As of October 2023, the IBC has contributed to an increase in the recovery percentage of stressed assets in the banking sector, which has been a persistent challenge for Indian banks.

The Jan Vishwas Bill is part of broader reforms aimed at simplifying regulatory frameworks to boost investment and economic growth. These legislative measures are crucial as India navigates post-pandemic economic recovery and seeks to boost investor confidence.