RBI’s resolution framework: Is it panacea or pain?

By Divakar Vijayasarathy

A shrinking GDP, ending moratorium and a spreading pandemic—a perfect recipe for large-scale chaos especially in a country already struggling with a falling growth rate and burgeoning public debt. Amidst this setting, there was a need for a framework to delay the inevitable, large-scale bad loans (NPAs). Every sector was crying for help, while the most affected one (banking) was considered to have the moral obligation to bail out businesses oblivious of their fiduciary responsibility towards small depositors and shareholders.