Govt may abandon special insolvency framework

The Indian government is contemplating the abandonment of the special insolvency and bankruptcy code framework designed for the real estate sector. This potential shift suggests a reevaluation of the existing approach to handling insolvency cases within the real estate industry. The unique challenges posed by the real estate sector may prompt the government to explore alternative mechanisms for addressing insolvency issues specific to this domain. This development reflects a broader strategy to align insolvency frameworks with the distinctive dynamics of different industries. As the government weighs its options, industry stakeholders and experts are keenly observing the potential implications of this decision on the real estate market. Any modifications to the insolvency framework are likely to influence how financial distress and insolvency cases are managed within the real estate sector, impacting both developers and investors.