The Indian government is considering continuing to file new deportation documents after the end of the current suspension on March 25, according to sources.
The proposal for suspension will come even if the outbreak of virus cases threatens economic recovery. It could stem the tide of debt default, created from last year when businesses were hurt by India’s first economic agreement for decades.
The government of Prime Minister Narendra Modi last year launched a process to introduce new debt cancellation laws to accommodate low-income borrowers who have been hit by the epidemic for six months from March 25, and that has doubled during the year.
The suspension is unlikely to go ahead because rehabilitation is needed, people said, requesting anonymity quoting the rules. Finance Minister Nirmala Sitharaman is considering a proposal for this.
A spokesman for the corporate affairs department did not respond to calls made on his cell phone during business hours.
The move closely follows a Supreme Court decision on Tuesday that allows lenders to resume segregation of bad debts. These two measures together give investors a clear idea of the impact of the epidemic on the quality of local bank assets. The move also paves the way for lenders to collect bad debts from rebellious borrowers, providing them with more tools to manage one of the world’s worst loans.
