Onlookers watch the evening sun set on the horizon beyond skyscrapers in the City of London, U.K. (Photographer: Simon Dawson/Bloomberg)

BQuick On Dec. 14: Top 10 Stories In Under 10 Minutes

This is a roundup of the top stories of the day.

1. Rafale Relief For Modi Government

The Supreme Court today dismissed pleas to probe India’s Rafale fighter jet deal with France, blunting the opposition’s attack on Prime Minister Narendra Modi and Anil Ambani in the multi-billion-dollar purchase.

  • There will be no court-monitored probe into the Rafale deal. “So far as the decision-making is concerned, we have studied the material and interacted with senior air force officers,” Chief Justice of Indian Ranjan Gogoi said delivering a unanimous verdict by a three-judge bench today. “There was no occasion to doubt the process.”
  • That’s a relief to Ambani, whose Reliance Naval and Engineering Ltd. was picked as an offset partner by Dassault Aviation in the Rs 58,000-crore purchase of 36 fighter jets in a fly-away condition.
  • Indian National Congress President Rahul Gandhi said that the truth about the deal will be revealed the day a joint parliamentary committee probed the deal.

The Supreme Court refused to go into pricing details.

2. Fortis-IHH Deal On Hold

The Supreme Court today ordered a status quo on the Rs 4,000 crore sale of Fortis Healthcare Ltd. to Malaysian group IHH Healthcare Bhd.

  • A three-judge bench headed by Justice Ranjan Gogoi was hearing the petition filed by Japanese drugmaker Daiichi Sankyo alleging former promoters—brothers Malvinder and Shivinder Singh—violated undertakings and court orders.
  • Daiichi had sought a stay on the Fortis sale as the Singh brothers had not fulfilled their commitment to pay the drugmaker as per the Delhi High Court’s orders, one of Daiichi’s lawyers told BloombergQuint on the condition of anonymity.
  • Daiichi’s lawyers argued in court that the Singh brothers created encumbrances on their shares even after the court order.

Shares plunged as much as 7.6 percent.

3. Congress’ Rajasthan Compromise

Senior leader Ashok Gehlot will return as the chief minister of Rajasthan after the Congress party snatched the desert state back from the Bharatiya Janata Party in the recent assembly elections.

  • The decision was taken by Congress President Rahul Gandhi after two days of discussions and consultations with other senior leaders, Gehlot and the other contender Sachin Pilot, who will now be the deputy chief minister.
  • Gandhi, for whom this is being called as a leadership test, met Pilot and Gehlot at least thrice since Thursday.
  • Yesterday, he chose nine-time parliamentarian Kamal Nath as the chief minister of Madhya Pradesh.

Gehlot is a five-time Parliamentarian.

4. Indian Markets Flat, U.S. Stocks Slip

Indian equity benchmarks rose for a fourth straight day led by Infosys Ltd., Bharti Airtel Ltd., ICICI Bank Ltd. and Yes Bank Ltd. However, the gains were capped as HDFC twins, Larsen & Toubro Ltd. and ITC Ltd. came under selling pressure.

  • The S&P BSE Sensex Index rose 0.09 percent or 33 points to 35,963.
  • The NSE Nifty 50 Index advanced 0.13 percent or 14 points to 10,805.
  • Thirteen of 19 sector gauges compiled by BSE ended higher led by the S&P BSE Telecom Index's 3 percent gain.
  • On the flipside, the S&P BSE Healthcare Index was the top loser, down 0.8 percent.

U.S. equities declined, tracking a slump across Asia and Europe, as worries over global growth brought a downbeat end to a rocky week. Treasuries and the dollar jumped.

  • The S&P 500 Index dropped at the open, with all sectors under pressure, including a retreat in technology.
  • The Bloomberg Dollar Spot Index jumped 0.6 percent to the highest in 19 months.
  • West Texas Intermediate crude decreased 0.6 percent to $52.27 a barrel.

5. RBI Board Buys Time

The central board of the Reserve Bank of India, which met for the first time since Shaktikanta Das took over as governor, stayed away from taking any controversial decisions.

  • The board discussed some of the issues that had become points of friction between the RBI and the government but did not announce any specific measures to address concerns raised by the political leadership.
  • One of the more contentious issues on the agenda was a proposed change in the governance structure of the Reserve Bank.
  • The changes were seen as a way to strengthen the role of the central board in the RBI’s decision making process.

The board reviewed economic situation and challenges.

6. Rajan’s Prescription For Stressed Assets

Former Reserve Bank of India Governor Raghuram Rajan said India needs a functional out-of-court restructuring process for stressed assets so that most of the cases are resolved out of bankruptcy code.

  • The National Company Law Tribunal can act as a court of last resort if no agreement is possible, he said.
  • “The NCLT will help restructure debt for the largest firms and projects under the bankruptcy code,” Rajan said while releasing the report, 'An Economic Strategy for India'.
  • “The tribunal will be overwhelmed if every stressed firm or project is filed before it.”
  • Rajan said both the out-of-court restructuring and bankruptcy processes, according to him, need to be strengthened and made speedy.
The out-of-court restructuring process requires protecting the ability of bankers to make commercial decisions without subjecting them to inquiry.
Raghuram Rajan, Former Governor, RBI

7. L&T JV Loses Mumbai Monorail Contract

Mumbai Metropolitan Region Development Authority terminated the contract on Friday with the L&T-Scomi Engineering consortium that has been operating the country's first monorail network after the Malaysian company failed to meet contractual obligations despite getting several extensions.

  • The MMRDA also took over the project and decided to operate and maintain it, besides deciding to en-cash the Rs 200-crore bank guarantee from the operator.
Finally, we have terminated the contract with the L&T consortium after granting them seven extensions and to operate and maintain the network on our own in the larger public interest.
RA Rajeev, Commissioner, MMRDA 

8. Forensic Audit Of Jet Airways

Country's largest lender State Bank of India has ordered a forensic audit of Jet Airways (India) Ltd.’s books for the period between April 2014 and March 2018, sources in the bank told PTI.

  • The cash-strapped carrier has been grappling with financial woes for many months.
  • SBI, which is the lead banker to Jet Airways’ over Rs 8,000-crore loans, has mandated Ernst & Young to conduct a forensic audit of the airline’s books, sources said, adding that the process has already begun.
  • The airline has been struggling to keep afloat following three consecutive quarterly losses of over Rs 1,000 crore each.

9. Modi’s Solar Plan For Farmers Derailed

India’s plan to make farmers generate solar power and wean them away from using diesel-run water pumps hasn’t taken off.

  • An ambitious project to generate 10,000 MW of solar power on farmlands and operate pumps hasn’t started because of paucity of funds, according to officials in the Power Ministry.
  • This comes even as India targets 225 gigawatts of renewable energy by 2022.
  • KUSUM or Kisan Urja Suraksha Evam Utthaan Mahaabhiyan announced in this year’s budget in February aimed to incentivise farmers to run solar water pumps.
  • The outlay for the scheme was estimated at Rs 1.4 lakh crore and was to be implemented by July.

10. GDP Data Revision: Eat Your Cake, Don’t ‘Cook’ It

The question is: if the government is willing to undermine the independence and credibility of the central bank for political purposes, why wouldn’t it be prepared to undermine the independence and credibility of India’s statistical office, asks Rabobank's Hugo Erken.

  • Rabobank's own model of economic drivers is used to back-cast economic growth for FY06-FY13.
  • The model indicates that the new back-series are not aligned with the development of some other key economic data.
  • India has to be careful not to go down the same route as China.
  • Unreliable statistics are worrying, especially for emerging economies who can easily lose the support of international investors.

Here are the three options for the Modi government to limit the damage from this controversy.