Fulbright grant provides close-up view of Indian bankruptcy reforms

When Professor Adam Feibelman received a Fulbright fellowship in March 2016, he envisioned spending the fall semester studying India’s nearly forgotten personal bankruptcy law dating to British rule of that country. 

But by May, the Indian Parliament, in an effort to boost India’s economy and its appeal to foreign investors, passed a sweeping new insolvency and bankruptcy code affecting both companies and individuals. Feibelman’s grant to support a six-month stay in India ended up providing a front-row seat to observe the early stages of dramatic changes to the system.

“It turned out to be a really fortuitous choice,” said Feibelman, the Sumter Davis Marks Professor of Law and Tulane Law’s associate dean for faculty research.

He was based at the National Law School of India University, Bangalore. Now known as Bengaluru, the city of about 10 million people is considered India’s “Silicon Valley,” the hub of the high-tech industry.

A financial reporter before going into law, Feibelman wound up interviewing people involved in writing and enacting India’s reforms, as well as experts on specific elements of the new law. Now, he’s writing a series of articles, including an essay co-authored with one of the principal drafters of the code, examining the challenges of collecting and disseminating data about the new system. Feibelman’s is likely to be the first serious scholarly analysis of India’s bold experiment in financial reform.

Feibelman joined the Tulane faculty in 2009, and his teaching and research focus on bankruptcy, regulation of financial institutions and international monetary law. He also directs the Program in Regulation and Coordination at Tulane’s Murphy Institute, which aims to study the effects of regulation on economic activity.

His project is very much in line with Tulane’s characteristic comparative perspective across the law curriculum. It offers a timely look at developments with worldwide implications: India is home to almost 1.3 billion people, and its economy is third-largest in Asia, according to The Wall Street Journal.

The new insolvency law “dramatically changed the substantive law of insolvency and bankruptcy and involved rather massive institutional changes,” Feibelman said. These institutional changes includes a new regulatory agency, a new category of insolvency professionals and new information utilities.

“It’s a really fascinating case study in legal reforms and the process of innovative lawmaking and rulemaking,” he said. “Assuming it does work as intended, it should have some influence on policymakers everywhere.”

Feibelman said he plans to continue studying how these changes play out for individuals because of his keen interest in bankruptcy protections for consumers.  

“I have always found the human aspect of financial relationships to be fascinating, and I think the law that governs those relationships is incredibly important in ways that people tend to overlook,” he said. “Commercial and financial law impacts our lives in so many countless ways. Once you start paying attention to that legal domain, it’s hard not to be drawn in.”