Soon, more colleges will offer post-graduate courses in bankruptcy resolution | Mint

New Delhi: With India witnessing a shortage of qualified professionals who can rescue financially distressed companies, the bankruptcy board has asked top institutions to introduce post-graduate courses in insolvency resolution.

Armed with a two-year degree, a graduate in select disciplines like accounting, law, finance and economics can become a bankruptcy resolution professional without waiting for the decade-long experience typically needed, according to the Insolvency and Bankruptcy Board of India (IBBI).

The bankruptcy rule maker has invited requests by 27 September from institutions with “quality residential facility to accommodate at least 100 students at a time” and “reasonably large campus with adequate space for expansion” to offer post-graduate programmes.

The institution should have high-quality education infrastructure like classrooms, library, computer lab, research centres, journals, publications and technology, with scope for expansion in these facilities.

Only two institutions currently offer a post-graduate insolvency programme (PGIP): the Indian Institute of Corporate Affairs and the National Law Institute University, Bhopal. At present, there are over 4,400 registered insolvency professionals in the country.

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Experts believe this move will increase the workforce available to handle the complex tasks of debt resolution and corporate rescue. 

Unlike previous initiatives, this time IBBI has included additional conditions, allowing it to select multiple institutions, modify expressions of interest, or reject them without explanation—ensuring that only the best institutions are chosen, said Yogendra Aldak, partner at Lakshmikumaran, and Sridharan Attorneys.

“With the additional conditions, we may witness IBBI selecting multiple institutions to conduct PGIP courses and the same would result in more students becoming insolvency professionals with relevant skills and experience,” said Aldak.

Such insolvency professionals would contribute to simplifying and expediting the insolvency proceedings in India, protecting the creditors and revive companies in a timely manner, said Aldak.

The ministry of corporate affairs and IBBI have been trying to scale up the number of bankruptcy cases resolved in a year, reduce the time taken for the process and improve the outcome of debt resolution. 

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In FY24, a record number of 269 resolution plans were approved by the National Company Law Tribunal, against 189 in the year before, a 42% improvement in rescuing distressed companies, Mint reported on 11 June.

IBBI said an insolvency professional plays a central role in the resolution, liquidation, and bankruptcy processes of businesses and individuals, acting as “the fulcrum of the process and the link between the adjudicating authority and the stakeholders”.

Also read: Mint Explainer: Why bankruptcy reforms should be the new govt’s top priority