Pressure Increases on India to Create Manager for $36 Billion in Distressed Debt

A decision by India’s top court to quash a method prescribed by its central bank for dealing with bad loans has triggered renewed demand to set up a manager for stressed power assets estimated at $36 billion.

Now that the court has voided the Reserve Bank of India’s directive on dealing with soured debt the finance ministry “should be able to form a much-needed” state-run manager to acquire power generating companies, according to a research note by BofA Merrill Lynch on Wednesday.