Go First’s foreign funding push to test India’s insolvency framework
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Subscribe to enjoy similar stories. Go First, the grounded airline entangled in bankruptcy proceedings, is seeking permission for a foreign funding lifeline to pursue a high-stakes arbitration case against Pratt & Whitney. If granted, the move would mark an unprecedented shift in India’s Insolvency and Bankruptcy Code (IBC), potentially reshaping how distressed companies fund litigation.
The New Delhi bench of the National Company Law Tribunal (NCLT) has yet to make a final decision, expressing initial reluctance. But the case has already sparked a larger debate about third-party funding in India, where insolvency laws remain untested for such scenarios. Read this | Go First to chase ₹12,000 crore with litigation finance “Foreign funding can provide additional financial resources, which might help in settling debts more effectively and potentially increase the value recovered by creditors," said Vishwanathan Iyer, partner at Anand Sharma and Associates.
In early September, Go First formally filed for liquidation, citing a lack of assets and a viable revival plan. Having exhausted all moratorium extensions under the Insolvency and Bankruptcy Code (IBC), the airline’s resolution professional (RP) sought the court’s approval to secure $20 million from Burford Capital, a US-based litigation finance firm. The funds will be deployed to pursue an arbitration case in the Singapore International Arbitration Centre, where Go First is claiming over $1 billion in damages.
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