Former Reserve Bank of India governor Urjit Patel has criticized the Modi government at the Center for the relaxation of the rules of bankrupt law during the release of his new book 'Overdraft: Saving the Indian Saver'.

Urjit Patel has said that the central government has relaxed the rules of insolvency and bankruptcy law and has also reduced the powers of the central bank, which negatively impacted the efforts made since 2014 to solve the NPA problem.

Urjit Patel, who held the post of RBI governor from September 2016 to December 2018, said that the RBI wanted the Bankruptcy Act to be strengthened so that companies in the future who are in the dilemma of default will get a lesson.

In February 2018, a circular was issued from RBI. It said that any creditor who is not paying the amount should be included in the defaulters' list. Apart from this, it was also stated in the circular that the promoters of the company that will default cannot buyback the stake in the company during the insolvency auction. The government had a different opinion on this. The government did not agree.

He told that till the arrival of the circular, he and the government had the same opinion, he used to have talks with the finance minister but after the circular came, his and the government's opinion was split. He said that the government wanted the bank to withdraw its circular but the bank refused to do so.

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