Lanco Infratech Ltd confirmed on Saturday that India's central bank had directed the company's lead lender IDBI Bank to initiate a corporate insolvency resolution process under the country's bankruptcy laws, Reuters reported. Lanco is among 12 companies that the Reserve Bank of India (RBI) has ordered lenders to take to bankruptcy court as it strives to cut the country's $150 billion in soured debt, sources told Reuters on Friday.

India's central bank has asked lenders to initiate bankruptcy proceedings against a dozen companies, including Essar Steel, Bhushan Steel Ltd, Monnet Ispat and Energy Ltd, sources with direct knowledge of the matter said. This follows a change enacted in laws last month that gives the Reserve Bank of India greater power to address the $150 billion stressed loan problem plaguing growth in Asia's third-largest economy, Reuters reported. This week, the RBI said it had identified 12 of the country's biggest loan defaulters.

India’s central bank plans to use insolvency laws against more corporate defaulters to speed up resolution of the country’s bad loans that have swelled to $180 billion, Bloomberg News reported. “The clock’s already ticking -- some cases are already before the National Company Law Tribune," said Sanjeev Sanyal, principal economic adviser to the finance ministry. "More lists will be out in the next few months." Cleaning up India’s stressed loans is the biggest priority of Prime Minister Narendra Modi’s government, Sanyal said in an interview in New Delhi.

The Reserve Bank of India aims to stop loan officers from throwing good money after bad. This week, 12 unnamed Indian companies were recommended for referral to the Insolvency and Bankruptcy Code, the Financial Times reported. The upshot is likely to be outperformance by shares in private sector banks with consumer credit exposure. The government push could lead to long workouts for debts amounting to a quarter of all non-performing assets nationally. State-owned banks’ provision levels are likely to be revealed as insufficient.

India’s banks have been ordered to use the country’s courts to resolve bad loans totaling about 2 trillion rupees ($31 billion) issued to 12 large debtors. The Reserve Bank of India told the banks to use insolvency laws to find a solution for the debtors, which account for a quarter of the country’s total bad loans, before moving on to resolve the other problem accounts within six months, according to a statement posted on the central bank’s website late Tuesday, Bloomberg News reported.

India's central bank said on Tuesday it has identified 12 of the largest loan defaulters and will order lenders to start bankruptcy proceedings against them to start unclogging the $150 billion in bad debt plaguing Asia's third-largest economy, Reuters reported. The move comes about a month after the Indian government gave the central bank greater power to deal with bad loans, including directing banks to initiate an insolvency resolution process in the case of a default under the bankruptcy code.

India is bracing for a dramatic but risky overhaul of the country’s tax system that authorities hope will draw millions of businesses into their tax net and boost the economy, The Wall Street Journal reported. The initiative, set to kick off on July 1, aims to streamline India’s cumbersome network of state and federal levies and ease commerce across state borders. It is a big part of a larger effort, including the cancellation of large-denominated currencies last year, to improve tax collection from companies that make up India’s huge informal economy.

Finance minister Arun Jaitley said the Reserve Bank of India (RBI) is drawing up a list of debtors with bad loans that need to be resolved under the insolvency law, The Economic Times reported. “Under the new ordinance issued, the RBI is at a fairly advanced stage of preparing a list of those debtors where a resolution is required through the Insolvency and Bankruptcy Code (IBC) process,” he said after reviewing the quarterly performance of state-run lenders and financial institutions.

Essar Steel India Ltd., the mill controlled by billionaire brothers Shashi and Ravi Ruia, expects lenders to decide on its debt restructuring plans by the end of this month as the company’s prospects brighten on increased output and an improved domestic demand outlook, Bloomberg News reported. “We are in discussions with lenders and the entire restructuring package should be done by June-end,” Shivramkrishnan Hariharan, the director commercial at the closely held Mumbai-based steelmaker, said in an interview Wednesday.

Prices on three of Reliance Communication Ltd.’s loans totaling $2.33 billion have been indicated in the mid- to low-70 cents on the dollar level, as the Indian telecommunications company’s bond and stock prices tumble while it scrambles to sell its tower business to repay debt, Bloomberg News reported. Two term loans for $1.33 billion and $925.2 million, plus a $75 million capital spending facility were indicated at this level, according to people familiar with the matter, adding that there have been no trades or offers on this bank debt recently.