New Delhi, April 30 -- The Indian government is exploring amendments to the Insolvency and Bankruptcy Code (IBC) to address environmental liabilities of defaulting companies, according to sources familiar with the matter.

This potential reform aims to make the bankruptcy framework future-ready and aligned with climate action goals, reported BS.

Currently, the IBC categorises environmental liabilities as ordinary trade claims with no special treatment. However, experts argue this approach fails to adequately consider the unique challenges posed by climate change and sustainability concerns.

"Integrating environmental objectives into the IBC will likely require fresh guidelines," a government source stated. "Key questions include who sho...