Page 13 - BANKING FINANCE MARCH 2024

ROUNDUP

Allotted flat won't be part the liquidation process. Separately, an increase in capital infusion does not
expert panel recommended phased necessarily mean that the rollout for
of liquidation process: IBBI introduction of a voluntary mediation the 4G network will be completed in
New rules of Insolvency & Bankruptcy as a dispute resolution mechanism un- the 2023-24 period or any tangible
Board of India (IBBI) provide for ex- der the Insolvency & Bankruptcy Code. gains in giving Indians access to 4G
emption of allotted property from liq- telephony.
The committee has proposed the es-
uidation process, providing much- tablishment of a dedicated and
needed relief to thousands of home specialised NCLT-annexed insolvency Centre launches venture
buyers, whose real estate projects are mediation cell with an independent capital fund to back tribal
caught in the insolvency resolution pro- secretariat to administer, oversee, and
cess for years with fear of liquidation manage the conduct of insolvency entrepreneurs
dangling over their head. Aiming to boost entrepreneurship
mediations under the law.
"Wherever the corporate debtor has among tribals, the Centre launched the
first of its kind 'Venture Capital Fund for
given possession to an allottee in a real BSNL gets capital infusion
estate project, such asset shall not Scheduled Tribes' to support them in
form a part of the liquidation estate of of Rs. 82,900 crore businesses ranging from manufactur-
the corporate debtor," IBBI said. The Centre has increased capital infu- ing, allied sector, start-ups and units
being incubated in technology sector
This means that homebuyers, who sion in public owned telecom operator for ensuring asset creation. The portal
have got possession of their flats, can BSNL to Rs 82,916 crore in the 2024- for applicants is now open and the
stay in them even if the project goes 25 Budget. In the previous budget, onground outreach in tribal belts has
into liquidation as their property will be 2023-24, it was Rs 52,937 crore. Ex- also started, officials said.
outside the ambit of the exercise. Most perts are of the opinion that a major
real estate projects have not faced portion of Rs 82,916 crore may be di- Beneficiaries will be able to avail in-
that situation yet. rected towards the allocation of 4G vestments between Rs 10 lakh to Rs 5
crore for up to 10 years and
and 5G spectrum.
IBBI is separately working on amend- concessional finance at 4% per annum.
ments to improve the insolvency reso- Last year the Cabinet approved a third The concessional finance will be avail-
lution process, which has so far been revival package for BSNL with an out- able to women and disabled at 3.75%.
slow for the real estate sector. The new lay of Rs. 89,000 crore for allotment of President Droupadi Murmu after
rules were notified by IBBI , which also 4G and 5G spectrum through equity launching the VCF for tribals at the in-
provides flexibility in cost reduction infusion. The approval set the stage for auguration of tribal festival - 'Aadi
during the liquidation process. the struggling telecom operator to Mahotsav' in Major Dhyan Chand Na-
launch 4G and eventually, 5G services.
The change in rule will mean that the tional Stadium in Delhi said that tribal
Part of this outlay is likely accounted
liquidator can reduce the reserve price entrepreneurs would benefit from the
by up to 25% for assets, with existing for in the interim Budget. scheme and be able to contribute to
valuation of the corporate insolvency Former BSNL Chairman and MD RK India's self-reliance.
resolution process (CIRP) once, pro- Upadhay welcomed this increase in The ministry of tribal affairs has also
vided it is approved by the Stakehold- capital infusion by the Centre: "Every set-up an IFCI Venture Capital Funds
ers' Consultation Committee (SCC). For year what allocation the government stall during the event so that inter-
assets where fresh valuation is con- is for specific purposes. This year's al- ested tribals can be guided on the way
ducted during liquidation, the reserve location is for network and spectrum forward to benefit from the VCF-ST
price can be cut by up to 10% in sub- costs. Broadly speaking, are we as a scheme.
sequent auctions, with SCC's approval. country to remain dependent foreign
Besides, liquidators have been given manufacturers, we also need to have National highways mone-
the power to sell assets of a company our indigenous products. We need tisation crosses Rs. 1 tril-
through private sale but through prior homegrown networks, and BSNL's 4G
consultation with SCC. The steps are rollout with TCS provides us that." lion
part of an exercise by IBBI to improve Another expert noted however that The total value of asset monetisation in

12 | 2024 | MARCH | BANKING FINANCE