Distortions in Land Markets and their Implications to Credit Generation in India

K.P. Krishnan (), Venkatesh Panchapagesan and Madalasa Venkataraman

Working Papers from eSocialSciences

Abstract: Land and buildings are a preferred collateral for lenders in India due to its ease of valuation and disposal in the event of default. Yet several distortions afflict Indian land markets that make this exercise non-trivial. These distortions - some structural, some regulatory and some information driven - are costly and have far reaching implications on credit availability as lenders adopt conservative policies ex-ante to mitigate these costs. Some of these distortions in the Indian land markets are examined in this paper and their significance is highlighted to the current debate on reforming bankruptcy framework in India.

Keywords: Land as collateral; collateral registries; land titles; prior liens and encumbrances; valuation; state vs. central government; market; credit generation; India; lenders (search for similar items in EconPapers)
Date: 2016-04
Note: Institutional Papers
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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