India has already discussed the matter with other countries for the pact, Sinha said.
Against the backdrop of Mallya episode, the government said it intends to enter into cross-border treaties to confiscate overseas assets of wilful defaulters and recover dues of banks as the Lok Sabha passed a bill that seeks to update existing laws in this regard.
Amid concerns expressed by members over rising instances of wilful defaults as highlighted by the case of liquor baron Vijay Mallya, Minister of State for Finance Jayant Sinha said bankruptcy framework and the normal procedure against them would continue in a parallel manner.
He was replying to a debate on the Insolvency and Bankruptcy Code Bill that seeks to update and consolidate existing laws, which was approved by the House later.The legislation is a “transformational building block” for the economy and there would be one law dealing with bankruptcy while doing away with at least 12 different legislations, some of which are centuries old. This will also make the whole process more “transparent”, Sinha said.
The new framework would help in improving India’s position in the World Bank’s ease of doing business ranking, he said.