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With the future of China's Evergrande Group hanging in the balance, global markets have plunged. Investors are worried as the crisis is getting compared with the 2008 global financial crisis. They are fearing whether the crisis could be a replay of the bankruptcy of Lehman Brothers during 2008.

Uday Kotak, chairman of Kotak Mahindra Bank said that Evergrande seems like China’s Lehman moment. He further said that it reminds him of Infrastructure Leasing and Financial Services Ltd (IL&FS) crisis in India.

“Evergrande seems like China’s Lehman moment. Reminds us of IL&FS. Indian Government acted swiftly. Provided calm to financial markets. The Government appointed board estimates 61% recovery at IL&FS. Evergrande bonds in China trading ~ 25 cents to a $," Uday Kotak tweeted.

In September 2018, IL&FS had defaulted on its debt obligations, triggering a liquidity crisis in the financial services market. The government was swift to act and replaced the IL&FS board with handpicked nominees. Subsequently, protracted rounds of an investigation by agencies, a forensic audit, the board’s own research and analysis to understand the depth of the rot, and the government’s recourse to the legal route to resolve the crisis followed.

Evergrande, which employs 200,000 people, has a presence in more than 280 cities and claims to indirectly generate 3.8 million Chinese jobs, has been on a buying spree for more than a decade. According to a report in Reuters, the debt-laden property developer's chairman in a letter to staff said that the group is confident the company will "walk out of its darkest moment."

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