Auto sales in China declined for an 11th straight month in May, with the slump in demand showing no sign of easing and the country’s automotive industry bracing for losses tied to new emissions standards, The Wall Street Journal reported. Sales for the latest month fell 16% from a year earlier, to 1.91 million vehicles. New vehicle emission standards are set take effect July 1, and dealers are scrambling to sell their older vehicles before they are disallowed at the end of June, often by offering steep discounts.

In China, debt takes many shapes – on the books, off the books, or buried deep within the financial system. Now, debt can even be considered equity, Reuters reported. In a bid to boost the economy, China this week announced it would allow local governments to borrow more to fund infrastructure investment. As part of this push, it will let municipalities use the proceeds of special-purpose bonds as equity in railroad, highway and other projects. 2 Previously, local governments weren't able to use such debt as seed capital. Using debt proceeds to fund equity is a dangerous proposition.

Embattled Indian tycoon Anil Ambani pledged to reduce debt at his infrastructure-to-finance conglomerate to a “bare” minimum, seeking to bolster investor confidence in an empire that’s grappling with high leverage and delayed asset sales, Bloomberg News reported. The Reliance Anil Dhirubhai Ambani Group has repaid 350 billion rupees ($5 billion) in the past 14 months, an amount entirely raised through disposal of assets, Ambani, 60, told reporters in a rare conference call Tuesday without elaborating.

The fate of Jet Airways is hanging in the balance and much rests on how today pans out. On one hand, reports suggest that the grounded carrier's lenders are expected to respond to the bailout conditions set by its strategic partner Etihad and the Hinduja Group this week, perhaps as early as Monday, and on the other hand Jet Airways is at risk of landing at bankruptcy court, Business Today reported. Two of the airline's operational creditors, Shaman Wheels and Gaggar Enterprises, have approached the National Company Law Tribunal (NCLT) for the recovery of their dues.

Indian film and entertainment group Eros International has taken steps to resolve delays in loan payments, Chief Executive Kishore Lulla said, as he also dismissed a short seller’s allegations of accounting irregularities at the group, Reuters reported. The company’s New York-listed shares plunged more than 55% last week, and those of its Indian subsidiary Eros International Media Ltd sunk more than 30%, after an Indian rating agency categorized debt of Eros’s Indian subsidiary at “default” levels due to delays in loan payments.

Even as investors bet on a resurgence for medium-sized Indian companies after Prime Minister Narendra Modi’s return to power, one of the country’s top mid-cap fund manager advises caution, Bloomberg News reported. This group of stocks won’t get an immediate lift from Modi’s victory as it isn’t immune to the slowdown in the economy and the lingering shadow-bank crisis, said Vinit Sambre, who oversees $1.6 billion in two mid- and small-cap funds at DSP Investment Managers in Mumbai.

Eros International Media Ltd. plunged Friday, bringing its two-day slump to 32% after Care Ratings downgraded the company’s creditworthiness, citing delays or likely default in servicing of bank loans, Bloomberg News reported. The filmmaker’s Indian-listed stock suffered a rapid erosion in market value this week after Care cut the long-term bank facilities rating 10 notches to D, or default from BBB-, a move that brought back memories of the steep downgrades last year at Infrastructure Leasing & Financial Services by Moody’s Corp.’s local unit.

The Reserve Bank of India diluted its guidelines on stressed assets and has now mandated banks to undertake a review of a borrower’s accounts within 30 days of default, according to a circular issued on Friday, Reuters reported. A circular issued in February last year required banks to initiate a resolution process as soon as a default took place. Banks unable to agree upon a resolution plan with the defaulter within 180 days were mandated to force them into a time-bound insolvency process.

Shares of mortgage lender Dewan Housing Finance Corporation Ltd (DHFL) fell as much as 18% on Thursday, their biggest intraday fall since February, a day after two leading ratings agencies downgraded the company to their lowest on the lender missing payments on bonds due this week, Reuters reported. ICRA cut its rating on the company’s paper to D from A4, while Crisil downgraded to ‘CRISIL D’ from ‘CRISIL A4+’, implying that the company was in default or expected to be in default soon.

Chinese debt is a potential billion-dollar market for international credit-rating companies. It’s also one riven with pitfalls. The world’s third-largest debt market can no longer be ignored. Chinese companies sold more than $1.4 trillion of bonds last year, more than was raised by their U.S. counterparts. Eager to attract more foreign investors, the government in January allowed the Beijing-based unit of S&P Global Ratings to offer corporate ratings services, a Bloomberg View reported.