IBC reform to skip real estate for now

The government will take up real estate-focused bankruptcy reforms separately, keeping them out of the Insolvency and Bankruptcy Code (IBC) amendments likely to be introduced in Parliament either during the winter session or in the budget session, two people aware of the matter said.

- Gireesh Chandra Prasad

The decision means structural reforms aimed at protecting homebuyers and resolving stuck housing projects-a major stress point in India's insolvency ecosystem-will wait longer. These measures were expected to address delays and low recovery rates in realty bankruptcies.

The ministry of corporate affairs is prioritizing insolvency law amendments that are already in an advanced stage, while real estate-focused reforms will undergo further expert and inter-ministerial consultations before being taken up separately, the people cited above said, requesting anonymity.

The IBC (Amendments) Bill, 2025—currently under review by a Lok Sabha select committee headed by BJP MP Baijayant Panda—proposes a creditor-led, largely out-of-court insolvency process for quicker corporate turnaround, faster tribunal admissions, a new framework for group and cross-border bankruptcies, and separate provisions to resolve implementation disputes.