IL & FS Crisis, lets learn more about it :

What is the crisis?

IL&FS has over Rs 91,000 crore in debt and is facing severe liquidity crisis. The default in payment of interest by the company has raised concerns over its financial stability. Since September 12, IL&FS has defaulted in payments of interest more than seven times so far.

IL&FS needs immediate capital infusion of Rs

3,000 crore and has also proposed Rs 4,500 crore as rights issue. The Reserve Bank of India (RBI) also met the shareholders of IL&FS on September 28 to discuss the revival and capital infusion plans for the company.

At the annual general meeting (AGM) of the company on September 29, shareholders - the State Bank of India (SBI), Life Insurance Company (LIC) and Orix Corporation - agreed to subscribe to the proposed Rs 4,500-crore rights issue.

Who owns IL&FS?

The LIC owns 25.34 per cent stake

while SBI owns 6.42 per cent. Orix Corporation of Japan is also one of the largest shareholders of IL&FS with 23.54 per cent stake.

On the other hand, Abu Dhabi Investment Authority, HDFC and Central Bank of India also hold 12.56 per cent, 9.02 per cent and 7.67 per cent stake respectively.

What has been its impact?

The market indices, Sensex and Nifty, fell during the trading session yesterday due to the IL&FS crisis. The defaults in payments by certain group entities of IL&FS have triggered fears of liquidity crisis in the financial markets. The NCLT allowed the government to reconstitute the board of IL&FS after market hours on Monday.

What has been done so far?

The NCLT has appointed a six-member panel to take over the management at IL&FS with immediate effect. The panel will be headed by managing director of Kotak Mahindra Bank - Uday Kotak.

The government said on Monday that an investigation by Serious Fraud Investigation Office (SFIO) has been ordered into the affairs of the IL&FS, according to a Business Today report. The government said it took this extraordinary step under section 241(2) of the Companies Act, 2013 to avoid further mismanagement of the company and in order to protect public interest.

Who said what?

Congress President Rahul Gandhi

Congress President Rahul Gandhi attacked Prime Minister Narendra Modi and his government for the IL&FS crisis. Mocking the government, he also gave other name for the crisis-ridden company, calling it "I Love Financial Scams".

He said, "Modiji, your favourite private company IL&FS is about to drown. You want to save it by using LIC's funds. Why? LIC is a symbol of the country's trust. People save every single penny to buy LIC policies. Why do you protect the fraudsters by using the people's money? Does ILFS mean 'I Love Financial Scams' to you?"

Finance Minister Arun Jaitley

On September 25, Finance Minister Arun Jaitley said the government is "closely" monitoring the situation arising out of the defaults by IL&FS Group.

LIC chairman VK Sharma

LIC chairman VK Sharma said on September 25 that as a shareholder it will not let IL&FS collapse and would explore more options to revive the crisis-hit IL&FS.

"We will ensure IL&FS does not collapse. We will not allow contagion to spread from IL&FS... All options are open (including raising stake in the company)," Sharma had said.