The world of crony capitalism in India has ceased to be with the introduction of Insolvency and Bankruptcy Code, NITI Aayog CEO Amitabh Kant said on Thursday.
"The world of crony capitalism in India has come to an end. Today, if you don't repay (the loan), you will lose your business empire. One after another, the businesses are losing their empire because it is going to NCLT (National Company Law Tribunal). The NCLT is bidding it out," he said responding to a query at an interactive session organised by the Indian Chamber of Commerce here.
Kant said: "The world has changed and there is no more crony capitalism in India. The Insolvency and Bankruptcy Code will ensure that. Therefore, it is incumbent that you take money from bank and you should repay. Otherwise, the government will not survive in India... How can government not react when a Nirav Modi incident happens?"
He said the banks were going bust because the advances by the lenders were not repaid and the government had to bring some discipline.
With the unearthing of fraud cases like Nirav Modi incident, the government was held accountable and it appeared to be a regulatory failure, he added.
However, in order to achieve higher economic growth, he urged restructuring of many institutions of India.
"You can't get India into 9-10 per cent economic growth till you don't restructure many of your institutions ... many of our institutions, for instance, Medical Council of India, is an outdated body. It is not allowed to create doctors.... UGC, AICTE, Medical Council of India and all these need to be radically restructured," he said.
He said it would be not be possible for India to grow at an annual rate of 9-10 per cent over decades, unless the country "consciously pushes for gender parity".
Kant said exports must also pick up in order to achieve higher economic growth and for which, micro, small and medium enterprises (MSMEs) should prosper.