ASIA BUSINESS OUTLOOK9DECEMBERNEWSROOMINDIA'S CENTRAL BANK HOLDS BENCHMARK RATE AT 6.50 PERCENT AMID INFLATIONChinese automakers are demonstrating the limitations of the European Union's electric vehicle tariff scheme by increasing their exports of hybrid cars to Europe and preparing further models for the important market.In an effort to cut costs related to tariffs, several businesses are now moving their assembly and production to Europe.Murtuza Ali, an analyst at Counterpoint Research, said, "The increase is driven by Chinese OEMs shifting toward PHEVs (plug-in hybrids) as a way to sidestep the new EU tariffs on BEV (battery-powered EVs) imports from China"Hybrid vehicles, which use both electricity and gasoline, are becoming more and more popular as consumers view them as an economical alternative to all-electric or all-combustion vehicles.According to data released by the China Passenger Car Association, hybrid exports to Europe from July to October more than tripled to 65,800 units compared to the same period last year, reversing a trend of declining sales until earlier this year and in 2023.As a result, in the third quarter, China's total vehicle sales to Europe accounted for 18 percent of plug-in hybrid and conventional hybrid exports, up from 9 percent in the first quarter. However, within the same time period, the percentage of EV shipments decreased from 62 percent to 58 percent. Expectedly, India's central bank maintained the benchmark interest rate at 6.50 percent, attempting to keep increasing inflation under control without impeding growth in the third-largest economy in Asia.Shaktikanta Das, the governor of the Reserve Bank of India, said that the domestic economy's decline had "bottomed out" in the September quarter and that the central bank had lowered its forecast for India's GDP growth in fiscal year 2025 from 7.2 percent growth in October to 6.6 percent growth.The RBI has maintained a stable interest rate since February of last year, but the central bank's job has become more difficult due to a more severe than expected downturn in India's economic growth.The slowdown has raised concerns that the economy may miss the RBI's 7.2 percent growth prediction for the year ending March 2025 as a result of its restrictive measures.To boost loan demand and sustain a faltering economy, both Trade Minister Piyush Goyal and Finance Minister Nirmala Sitharaman have allegedly urged for lower borrowing prices.LSEG data indicated that the Indian rupee hit historic lows versus the U.S. dollar earlier this week, and any monetary easing policies would probably cause the currency to experience additional pressure and lead to capital flight. CHINESE AUTOMAKERS CHALLENGE EU EV TARIFF WITH HYBRID EXPORTS TO EUROPE
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