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We have bankruptcy for corporations and individuals, why not for countries?

What is the point of holding debt instruments that are beyond the debtor’s ability to repay?

Your question would be valid if Argentina had no assets, but like all bankrupt entities, Argentina does have assets. The instant case is not one of forcing them to repay a debt they cannot repay. It is a question about the fair allocation of resources to repay their creditors.

Argentina is repaying current borrowers. The essential case before the court was: can an entity which is meeting current obligations under the laws of New York State be allowed to default on past obligations under the same laws? The Court has decided they cannot.

It's not a question about whether they can pay, or when they can pay. It's a question of whom can they pay?

We have bankruptcy for corporations and individuals, why not for countries?

There is such a thing: it's called a debt restructuring.

The difference is this: if a company goes bankrupt or an individual goes bankrupt, I can seize some (in individual cases) or all (in corporation cases) their assets to satisfy my debt.

What is the point of holding debt instruments that are beyond the debtor’s ability to repay?

Argentina has $0.5T in GDP and $50B in annual tax receipts.

These bonds have total value of less than $10B.

This debt is less than 2% of GDP, and an agreed repayment schedule would barely touch Argentina's budget.

The simple fact is that the Argentine government wanted to buy votes by spending more than it had and it decided to make ends meet not by exercising fiscal discipline, but by stiffing lenders.