On the heels...

...of a recent The Economist article claiming India's financial system was "more conservative" than the United States. This is absurd. After all, the market's reaction to S&P's "downgrade" of the U.S. was muted, to say the least. Let the sunlight in and let the market decide, because one way or another they will anyway and these measures show a hand of weakness as investors decide caution is the better part of valor.

SREI Infrastructure Finance, one of India’s biggest non-bank lenders, has won a court order blocking Fitch Ratings from publishing a downgrade to its credit rating, sources told IFR.

Fitch said on Tuesday it had received an order from the Calcutta High Court, dated March 20, preventing it from publishing a rating action on SREI.

Court documents showed that Fitch was ordered to state: “Fitch has received an order from the Hon’ble High Court of Calcutta dated March 20, 2012 pursuant to which Fitch India has been restrained from publishing a rating action with regard to SREI Infrastructure Limited. Fitch is therefore unable at this time to publish a current rating on the issuer.”

Neither the rating agency nor the issuer would elaborate on the matter, citing the ongoing legal proceedings. However, sources said the rating agency had earlier told SREI it planned to downgrade the firm.

The injunction is the most extreme reaction for years to an unwelcome rating move, and raises questions over the rating industry’s ability to provide free and independent advice.