OVERNIGHT NEWS * India's economic gloom deepened on Friday with a surprise drop in industrial output, a fall in exports and

higher retail inflation, adding to the central bank's challenge of reviving the economy and supporting the rupee. * Indian Hindu nationalist leader and possible prime ministerial candidate Narendra Modi triggered an uproar on Friday over a remark he made in an interview about deadly communal riots in Gujarat state in 2002. * The Reserve Bank of India on Friday asked banks to strictly adhere to customer identification and anti money laundering rules for walk-in customers when selling insurance, mutual fund, gold and any other products above 50,000 rupees ($840). * U.S. Trade Representative Michael Froman urged India on Thursday to reverse course on policies that he said discriminated against American companies and were fraying relations between the world's two largest democracies. KEY FACTORS TO WATCH * India will release monthly WPI inflation data for June on Monday, at about 11.30 IST (6.00 GMT). * Montek Singh Ahluwalia, deputy chairman of India's plan panel will speak at an event on Monday at 9.30 IST (4.00 GMT), organised by India Private Equity and Venture Capital Association. * Reserve Bank of India Governor Duvvuri Subbarao will first speak on inclusive growth at an arts, science and commerce college and later at a management institute at about 0430 GMT. MAJOR DEALS AND MERGERS * Citigroup, HSBC, JM Financial, SBI Capital and UBS have been hired to manage the government's 54 billion rupees ($900 mln) sale of a stake in Indian Oil Corp. OVERNIGHT NEWS * The Reserve Bank of India announced measures late on Monday to curb the rupee's decline by tightening liquidity and making it costlier for banks to access funds from the central bank. KEY FACTORS TO WATCH * Finance Minister Chidambaram is speaking at private equity event at 0400 GMT. * Finance Minister P. Chidambaram will address a press conference at 0900 IST (0330 GMT) in Jaipur. MAJOR DEALS AND MERGERS * An offshore subsidiary of Hinduja Group-owned Gulf Oil Corp has raised a $300 mln seven-year borrowing. The facility is backed with a similar sized standby letter of credit, which, like the loan, also matures on November 15 2019. * The Indian Government has appointed IDBI Capital to manage the 4.9 bln rupees ($83 mln) offer for sale in India Tourism Development Corp. * Engineers India has filed the draft prospectus for its 4.7 bln rupees follow-on offer.

NEWS FROM BANKING INDUSTRY

OVERNIGHT NEWS * India relaxed foreign direct investment (FDI) rules on Tuesday in a broad swathe of industries including telecoms, single brand retail and oil and gas in a bid to lure capital inflows, prop up a sliding currency and rev up growth. [ID: nD8N0FE00C] * India's boldest attempt yet to prevent a rout in the rupee delivered only a modest lift in the currency but shares slumped and bond yields jumped as investors worried that policymakers might overplay their hand and damage economic growth. KEY FACTORS TO WATCH * Finance Minister P. Chidambaram will address a press conference at 1200 IST (0630 GMT) on the sidelines of a conference of tax officials.

OVERNIGHT NEWS * The Indian rupee's slide to record lows is squeezing mid-sized companies that borrowed offshore when times were good, with a slowing economy now making it even harder for them to generate the extra funds needed to cover dollar payments. * India will extend the powers of the country's market regulator, allowing it to monitor investors' call records and conduct searches at companies suspected of wrongdoing, the cabinet said on Wednesday. KEY FACTORS TO WATCH * India cbank to sell $2 bln in bonds on Thursday ,the third stage of its risky three-prong plan to drain cash from the financial system and support the faltering rupee. Results due out around 1700 India time or 1130 GMT. OVERNIGHT NEWS * The Reserve Bank of India set the amount of underwriting by primary dealers lower than the total amount of issuance for Friday's government bond auction due to high fees bid by primary dealers in case of a devolvement, dealers said. KEY FACTORS TO WATCH * India's Prime Minister Manmohan Singh will address a business chamber's annual meeting at 0430 GMT. MAJOR DEALS AND MERGERS * NSL Renewable Power has closed a multi-tranche currency loan. The loan is split into a $25 mln 12-year tranche A paying a margin of 430 bps over Libor.Tranche B of 1.25 bln rupees, which matures in July 2026, pays an interest of 13 pct. * Deutsche Bank is said to have issued 27 mln rupees Uridashi bonds today out of a 250 mln rupees six-year 5.58 pct programme, sources said.

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