Good morning, friends. It’s been a rough week for the customers and executives of IndiGo as the airline remained effectively grounded after the cancellation of some 2.2k flights. We spoke with an industry insider to get the rundown on what went wrong and where things might go from here.

THE BIG STORY this morning on the MENA-India corridor: India and Oman are close to signing a trade agreement that could reinvigorate economic ties. Modi is visiting the Sultanate as parliament there talks through the agreement.

MEANWHILE- Bharti Airtel subsidiary Indus Towers has planted a UAE outpost to scout for African business opportunities. And in Riyadh, a unit of Welspun has bagged a USD 140 mn order.

ALSO- Adani and Ambani have announced big green energy plans and the Modi government is shying away from “big-bang” divestments, opting instead for bite-sized stake sales served at a decidedly medium-rare pace.

PLUS: The IPO queue refuses to end, with ICICI Prudential AMC eyeing an INR 1.07 tn valuation as it makes its public-market debut.

^^ All of that and more, below.

IN MENA THIS MORNING-

Nassef Sawiris is merging EGX- and ADX-listed Orascom Construction with Dutch-listed OCI Global to form a single Abu Dhabi-based infrastructure and investment platform. The board-approved deal values Orascom at USD 1.52 bn and OCI at USD 1.35 bn, with shareholders voting in January and closing expected in 1Q 2026. The combined entity — to be renamed Orascom — will have firepower to deploy more than USD 1 bn of equity into infrastructure and concessions, building on Orascom’s c. USD 13 bn backlog and OCI’s recent multi-bn USD asset disposals. It could signal a structural shift for regional infrastructure investing.

Wall Street isn’t buying Saudi’s budget math. Analysts at Goldman Sachs and Bank of America are skeptical of the Kingdom’s 2026 budget deficit target of 3.3% of GDP, saying the actual gap will be in the 5-6% range. The risk here: The state’s going to borrow more (at home and abroad), crowding-out private-sector borrowers. Meanwhile, BlackRock is interested in pushing into Asia in partnership with GCC sovereign wealth funds, specifically noting the “India bull story” and key windows in AI and infrastructure.

In Egypt, the next phase of the Madbouly government’s divestment program has been pushed back to 1Q 2026 as officials finalize a stock-market incentive package and eye a more favorable trading window. The Gabal El Zeit wind farm listing remains on the table. And the long-stalled USD 35 bn gas export agreement with Israel appears to be moving. Israeli media report Leviathan partners and Israel’s Energy Ministry have reached an agreement, with Netanyahu expected to greenlight it ahead of his meeting with US President Donald Trump on 29 December.

Happening today: The US Federal Reserve decides on interest rates. It’s widely expected to cut 25 bps — look for Saudi and the UAE to follow suit given their currency pegs.

^^ Want to go deeper? Check out our UAE, Saudi, and Egypt editions.

WATCH THIS SPACE-

#1- BlackRock wants to invest in India alongside Gulf sovereigns: BlackRock’s chief strategist for the Middle East and Asia Pacific said the asset manager is “very open minded” about co-investment and JV opportunities with GCC SWFs to tap into what he called the “very real … India bull story.” Ben Powell said BlackRock, which manages USD 13.52 tn in assets, wants to piggyback on the scale and reach of SWFs as it looks to push deeper into Asia.

What does BlackRock like? The GCC-Asia focus comes as BlackRock’s 2026 strategy calls for a major push into artificial intelligence and infrastructure. Powell argues that the AI “mega boom” will continue to gather momentum and become a “mainstream asset class over the next few years.” BlackRock recently established a regional headquarters in Riyadh and acquired a commercial license to operate in Abu Dhabi.

AND- Speaking of AI: Microsoft will invest USD 17 bn in Indian AI initiatives including infrastructure, skills, and sovereign capabilities, making it the tech-giant’s largest investment pledge in Asia, CEO Satya Nadella said on X. The figure includes the USD 3 bn commitment the tech giant made earlier this year. The four-year commitment starts in 2026 and is intended to give Microsoft the largest cloud-computing presence in India, according to Reuters.

#2- No big privatization sales in the next budget: The Modi government will favor gradual minority stake sales over “big-bang” disinvestment from public sector enterprises to navigate revenue pressure as it faces lower receipts from the goods and services tax, Hindu Businessline reports, citing an unnamed Finance Ministry official.

Value over volume: The government says the emphasis is now value creation through targeted offer-for-sale transactions and selective IPOs — not “disinvestment” targets — a term no longer used in budget documents. Earlier, the government would announce major disinvestment targets as a part of the budget, which it failed to achieve in successive fiscal years. The government says that announcing minority stake sales with a short notice has a lower impact on valuation and avoids political friction.

Headroom everywhere: The government figures it has assets worth INR 23 tn (USD 256.6 bn) across 66 listed public sector enterprises and INR 18 tn (USD 201.4 bn) across 16 listed public financial institutions, giving it ample opportunities to sell.

OUR TAKE- With the rationalization of indirect tax rates in September, India’s tax revenues are likely to decline, prompting the government to tap divestments to meet revenue targets in the next fiscal year. The Modi government is taking a cautious approach to privatization to avoid resistance from within public sector companies and the political opposition. A go-slower approach will allow officials to build a track record after failing to attract marquee investors for big transactions including the sale of a 53% stake in Bharat Petroleum Corporation.

#3- Adani Group will invest over INR 6.74 tn (USD 75 bn) in the energy transition by 2030, according to Business Standard, citing remarks by chairman Gautam Adani. Adani said India must chart its own development path amid external pressure on coal exit timelines.

Adani’s climate math: Adani said India’s per-capita electricity use remains below 1.4k kWh, far short of the global average, while its per capita emissions remain under 2 tonnes, versus 14 tonnes in the US and 9 tonnes in China. Despite ranking third in total emissions, India has contributed just 4% of cumulative global emissions over two centuries, Adani said, calling recent sustainability downgrades “misaligned with India’s realities.”

CRITICAL CONTEXT- Adani’s pitch for India to chart its own transition path lands as policymakers mull extending coal build-out. The USD 75 bn green-energy pledge may help blunt global critique as India backslides on its climate ambitions.

[wwtt3] #4- Supplementing Adani’s pitch, Reliance Infrastructure is planning one of India’s most advanced integrated solar-manufacturing ecosystems — spanning ingots, wafers, cells, and modules — to tackle a demand-supply gap as India’s annual need for solar modules is expected to hit 5.5k GW by 2030, Business Standard reports. The firm claims the vertically integrated platform will reduce import dependence and strengthen clean-energy security, as per an investor presentation.

Building the missing link: The group is also establishing an end-to-end battery manufacturing ecosystem. India’s stationary-storage base, now under 1 GWh, is projected to reach 250 GWh by 2032. Domestic capacity currently supplies less than 10%, according to the business daily.

While green energy is the hottest option on the menu, India’s Reliance Industries has increased Middle Eastern crude uptake, including from UAE, to at least 10 mn bbl in January, Bloomberg reports, citing traders. India’s state‑owned Mangalore Refinery and HPCL‑Mittal Energy have also increased purchases from the region as they aim to replace Russian crude.

#5- Tata wants to make chips for Intel: Tata Electronics has lined up US hardware giant Intel as a customer for its planned semiconductor facilities, Reuters reports. Tata is investing about USD 14 bn to build India’s first chip fabrication plant in Gujarat and an assembly-testing unit in Assam, central to positioning India alongside Taiwan as a global semiconductor hub. Both companies will also explore scaling AI PC solutions for India’s consumer and enterprise markets, which they expect to become a global top-five market by 2030.

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DATA POINT-

The US has deported nearly 3.2k Indian nationals so far in 2025, a 130% increase from last year, Business Standard reports, citing government data shared with parliament.

THE BIG STORY ABROAD-

Trump clears path for Nvidia chip sales to China: The Trump administration will allow Nvidia to sell its advanced H200 AI chips to approved customers in China, easing export restrictions imposed during the Biden administration. Under the new deal, the US government will take a 25% cut of proceeds — up from 15% in a prior agreement — with similar arrangements expected for AMD and Intel. The decision follows months of lobbying by Nvidia CEO Jensen Huang, who pledged USD 500 bn in US AI investments. The move has drawn criticism from lawmakers, who warned it could aid China’s military and surveillance capabilities. (Guardian | Reuters | CNBC | New York Times | Bloomberg | BBC)

AND IN BUSINESS NEWS- The European Commission has launched an investigation into whether Google uses content from websites and YouTube videos to power its AI-generated summaries and other tools without compensating creators or offering opt-outs, the commission said in a statement. Regulators are also examining if Google’s AI Mode reduces traffic to publishers’ sites. The investigation follows complaints from media groups and campaigners who say Google’s AI Overviews divert readers and threaten journalism revenues. (BBC | CNBC | Reuters | Guardian)

PLUS- Investors brace for a divided Fed: Markets expect the US Federal Reserve to cut interest rates by 25 bps today to a 3.50-3.75% range, but analysts warn of deep divisions within the policy committee — possibly the most dissent seen in years, Reuters reports. As many as five of the 12 voting members could oppose the move, raising concerns about growing politicization under President Trump, who has pushed for lower rates ahead of next year’s midterms.

MARKET WATCH-

Quick commerce bubble warning: India’s quick-commerce sector is “hurtling toward a shakeout” as funding dries up and a model built on relentless fundraising nears its limits, Bloomberg reports, quoting Blinkit CEO Albinder Dhindsa. Companies will soon have to decide how long they can keep absorbing steep losses, Dhindsa said, adding that when such an imbalance exists, “the correction is very swift” and often catches players by surprise.

Cash guzzlers: Blinkit’s q-commerce rival Swiggy is preparing a USD 1.1 bn share sale barely a year after its USD 1.3 bn market debut, at roughly the same valuation as its IPO. Another rival, Zepto, has raised USD 450 mn ahead of a planned listing next year. A lot of this money is fueling 10-minute deliveries with markdown for daily consumables by these apps, with net income nowhere in sight.

Global investors are watching closely: Global investors — including SoftBank Group, Temasek Holdings, and several GCC SWFs — have poured bns into India’s quick-commerce sector, making it one of the most closely watched rapid-delivery markets globally.