The United States government has put forward a proposal to support India's ambitious plan to transition to electric buses. The proposal, which is currently under negotiation, involves the US extending a $150 million payment guarantee for companies that will supply electric buses to India's state transport undertakings (STUs). This financial backing is seen as a key move to bolster India's National Electric Bus Programme (NEBP), which aims to float tenders for approximately 50,000 electric buses over the next five years.

The initiative is part of a broader strategy to foster e-mobility adoption in India and shift away from diesel-powered transportation, aligning with the country's net zero ambitions. To mitigate past issues faced by suppliers, such as the financial challenges of STUs and the absence of payment guarantees, an escrow account will be established to serve as a payment security mechanism should STUs default on payments.

The discussions are taking place against the backdrop of Commerce and Industry Minister Piyush Goyal's visit to the United States, where he is also engaging with Tesla (NASDAQ:TSLA) CEO Elon Musk regarding the establishment of Tesla's first factory in India. The ongoing talks and the proposed fund are expected to gain further momentum with US President Joe Biden's planned visit to New Delhi in January, an event that is anticipated to enhance bilateral relations and promote collaborative efforts on clean energy and transportation.

The need for such financial instruments became evident following obstacles encountered in January 2023 when Convergence Energy Services Ltd (CESL) tendered for 4,675 electric buses but faced hurdles due to the lack of payment guarantees. By introducing a payment security mechanism, both countries aim to address these financial barriers and ensure manufacturers are safeguarded against potential defaults by STUs.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

By David Morgan and Moira Warburton

WASHINGTON (Reuters) -The U.S. House of Representatives on Tuesday passed a temporary spending bill that would avert a government shutdown, with broad support from lawmakers in both parties.

The legislation, which would extend government funding through mid-January, now heads to the Senate, where Democratic and Republican leaders have voiced support.

To prevent a shutdown, the Senate and Republican-controlled House must enact legislation that President Joe Biden can sign into law before current funding for federal agencies expires at midnight on Friday.

The 336-95 vote was a victory for House Speaker Mike Johnson, who faced down opposition from some of his fellow Republicans, in the first consequential vote of his tenure.

Johnson was elected to the post less than three weeks ago, following weeks of tumult that left the chamber without a leader. With a slim 221-213 majority, he can afford to lose no more than three Republican votes on legislation that Democrats oppose.

Senate Majority Leader Chuck Schumer, a Democrat, said in a statement on Tuesday night after the vote that he was pleased the bill passed "with a strong bipartisan vote," adding that he would work with his Senate Republican counterpart, Mitch McConnell, to pass it "as soon as possible."

The stopgap spending bill would extend government funding at current levels into 2024, giving lawmakers more time to craft the detailed spending bills that cover everything from the military to scientific research.

Some Republicans on the party's right flank said they were frustrated that it did not include the steep spending cuts and border-security measures they sought.

The bill passed with 209 Democratic and 127 Republican votes, while 93 Republicans and two Democrats voted against it.

Johnson's predecessor as speaker, Kevin McCarthy, was ousted by a handful of Republicans after a similar vote in September that relied on Democratic votes to avert a shutdown.

But hardline conservatives said they were not turning against Johnson. "We don't support it. But we do support him," said Representative Bob Good.

Other Republicans said it was better than other options.

"This isn't ideal," Republican Representative Mike Garcia said. "But a shutdown is a far worse world to be in."

Johnson's bill would extend funding for military construction, veterans benefits, transportation, housing, urban development, agriculture, the Food and Drug Administration and energy and water programs through Jan. 19. Funding for all other federal operations - including defense - would expire on Feb. 2.

Congress is in its third fiscal standoff this year, following a months-long spring impasse over the more-than-$31 trillion in U.S. debt, which brought the federal government to the brink of default.

The ongoing partisan gridlock led Moody's (NYSE:MCO) on Friday to lower its credit rating outlook on the U.S. to "negative" from "stable," as it noted that high interest rates would continue to drive borrowing costs higher.

SYDNEY (Reuters) - Australia said on Wednesday China could lift all its remaining trade blocks by next month as relations between the commodity trade partners stabilise and after Prime Minister Anthony Albanese's visit to Beijing earlier this month.

Albanese's government has taken credit for patching up ties with China since coming to office last year. China has lifted most trade blocks imposed amid a 2020 diplomatic dispute after Australia called for an inquiry into the origins of COVID-19.

"I remain very confident ... that by Christmas all of these trade impediments will be removed," trade minister Don Farrell told ABC Radio from San Francisco, where he is attending Asia-Pacific Economic Cooperation (APEC) meetings.

"And we will have restored that stable relationship that we want with our largest trading partner."

Farrell said he hoped to resolve the issues over lobster and beef, which related to bio-security rules, ahead of a meeting with Chinese counterpart Wang Wentao in San Francisco.

BENGALURU (Reuters) -U.S. electric car maker Tesla (NASDAQ:TSLA) Inc is planning to double the number of components it imports from India, Indian trade minister Piyush Goyal said on Tuesday through a post on social media platform X.

"Proud to see the growing importance of Auto component suppliers from India in the Tesla EV supply chain. It is on its way to double its components imports from India," Goyal posted on X, earlier called Twitter, after visiting Tesla's manufacturing facility at Fremont, California.

He was, however, unable to meet Tesla chief Elon Musk during his visit to the plant, Goyal added.

He said in September Tesla was aiming to source components worth between $1.7 billion and $1.9 billion from India this year, having bought $1 billion of components last year.

The minister's visit to the U.S. was supposed to include discussions with Musk around Tesla's plans to setup an Indian factory, manufacturing a $24,000 car there, sourcing more components and establishing charging infrastructure across the nation, Reuters reported last week.

By Victoria Waldersee and Nick Carey

BERLIN/LONDON (Reuters) -After years of accelerating growth, Europe's electric car sales appear to be entering a go-slow zone as drivers wait for better, cheaper models that are two to three years down the road.

Fully-electric sales in Europe were up 47% in the first nine months of 2023, but instead of celebrating, automakers including Tesla (NASDAQ:TSLA), Volkswagen (ETR:VOWG_p) and Mercedes-Benz (OTC:MBGAF) sounded a sombre note.

High interest rates and a subdued market are putting customers off, they warned, with Volkswagen's EV order intake half what it was last year.

Dealers in Germany and Italy as well as research by four global data analysis firms say there is more behind the slower uptake than economic uncertainty, with the consumers unconvinced that EVs meet their safety, range and price needs.

"The main problem is uncertainty," said Thomas Niedermayer, head of a 45-year-old family-owned Bavarian car dealership.

"Many assume that the technology will improve and would rather wait three years for the next model than buy a vehicle now that will quickly lose value."

Take Flavia Garcia and Tom Carvell in Edinburgh, Scotland.

Their 15-year-old hand-me-down Toyota (NYSE:TM) Auris, nicknamed Martina, needs replacing. With a petrol and diesel car ban nearing, the couple would consider an EV, but are put off by a lack of charging infrastructure, battery life fears and price.

AutoTrader says new EVs in Britain are still on average 33% more expensive than fossil-fuel models.

And most new models in the pipeline targeting entry-level consumers will not hit the market before 2025 at the earliest – by which time they will be contending with an expanded Chinese line-up from BYD (SZ:002594) to Nio (NYSE:NIO) in Europe.

"You want to do the right thing for the environment, but it feels like you're setting yourself up for a very expensive investment that will make your life that bit more complicated," Garcia, a 29-year-old corporate media director, said.

"We'll probably get a hybrid first".

FALLING BEHIND

Critics have long warned that a lack of affordable EVs would eventually stall the steep sales growth boosted by early adopters and corporate fleets.

A weaker performance in September, consumer sentiment surveys and bleak commentary from carmakers and dealers indicates that low growth era may have arrived.

U.S. automakers, though further behind on the transition to EVs, are also feeling the pinch. Ford (NYSE:F) and GM warned recently they were delaying the launch of cheaper EV models and pulling back on spending due to weaker demand and higher costs in the wake of new United Auto Worker contracts.

But the problem is cyclical.

Demand will remain slow for as long as there are no cheaper EVs available, Felipe Munoz of JATO Dynamics said of the slowdown in sales in Europe in September.

"From a regulatory standpoint, they don't have to push product out right now - they can afford to focus on profitability," said Alistair Bedwell, head of powertrain forecasting at GlobalData.

"But they need to have an eye on Tesla and the Chinese brands, because they don't want to get too far behind."

Intention to buy an EV has stayed constant in Germany over the past year, a poll by consumer research firm The Langston Co showed - meaning that although the number of EVs being sold is rising, the number of people wanting to buy an EV is not.

Growing sales may simply be a sign that carmakers who were struggling to produce EVs because of supply chain bottlenecks can finally meet backed up orders, rather than a sign of rising demand, said The Langston Co's insights manager Ben DuCharme.

Philip Nothard, insight director at dealer services firm Cox Automotive, said low residual values also put buyers off as companies and many consumers choose new cars based on what they can sell them for a few years down the line.

"We call it the valley of death, which we will be going through in 2024 to 2027: low residual values, high supply, and low demand," Nothard added.

By David Lawder and Ann Saphir

SAN FRANCISCO (Reuters) - U.S. Treasury Secretary Janet Yellen on Monday said negotiations on the trade section of Indo-Pacific Economic Framework will need further work, a setback for the Biden administration which had hoped to announce substantial completion this week.

Yellen told a news conference there has been "very substantial progress" on three of the four areas under discussion by the 14 IPEF member countries, but there are "remaining issues" on trade."

A centerpiece of the Biden administration's efforts to deepen economic ties with Asian nations and counter China's rising dominance in the Pacific, the IPEF is a forum for multilateral talks aimed at forging agreements in a range of areas, including trade.

She said there had been "significant progress" on the trade pillar, "but it looks not to be complete, like something that is likely to require further work."

"My understanding is that very substantial progress has been made on three of the four pillars" of the talks, she said, referring to talks on supply chains, the climate transition, and anti-corruption.

Yellen's comments on the trade pillar were in line with those of people familiar with the talks, who told Reuters that talks on improving labor and environmental standards, and ways to enforcement compliance have run into resistance from some member countries.

The Biden administration had hoped to announce some outcomes on the trade pillar this week as leaders of Asia Pacific Economic Cooperation (APEC) countries gather in San Francisco.

U.S. President Joe Biden is eager to portray IPEF as producing meaningful outcomes to IPEF countries, which are mostly APEC members, as he seeks to offer Asia a U.S.-led alternative to deeper economic ties to China.

By David Lawder

SAN FRANCISCO (Reuters) -U.S. Treasury Secretary Janet Yellen called on Pacific Rim finance ministers on Monday to boost the productive capacity of their economies while working to finance the transition to low-carbon energy and provide more opportunities for the poor.

Opening a meeting of finance ministers of Asia Pacific Economic Cooperation countries, Yellen said the group's economic dynamism meant the actions they take matter for addressing global challenges.

Yellen said in prepared remarks that the 21 APEC economies needed to collaborate to meet goals for the 2023 U.S. hosting year of creating an "open, dynamic, resilient, and peaceful Asia-Pacific community."

A day after the APEC Secretariat issued new forecasts for slowing growth next year citing the inflation fight and U.S.-China tensions, Yellen said the group needed to increase potential output.

"We need to further improve our long-term economic outlook by boosting labor supply, innovation, and infrastructure investment, in ways that are also sustainable and reduce inequality," Yellen said.

"We need to put ourselves on a sustainable growth path, one where we safeguard our planet while providing our economies with the clean energy they need to grow. And we need to leverage emerging technologies to drive innovation while maintaining safe financial markets," Yellen added.

Treasury released a research paper saying expenditures to reduce carbon emissions now would reduce costlier damages from more frequent and powerful storms, floods and forest fires.

It cited research estimating that spending $50 billion per year to build higher bridges and move transportation routes inland for 136 coastal cities around the world would reduce expected annual economic losses from climate change in 2050 by nearly $1 trillion.

The APEC finance ministers meeting precedes the APEC leaders' summit this week and a high-stakes meeting between U.S.-President Joe Biden and Chinese President Xi Jinping aimed at easing tensions between the world's two largest economies.

On Friday, Yellen agreed with her Chinese counterpart, Vice Premier He Lifeng, to "intensify communication", while warning Beijing's new economic czar to crack down on Chinese that are aiding Russia's Ukraine war effort.

The agenda for the meeting includes bringing more workers into APEC country workforces, investments in infrastructure and research and mobilizing resources to accelerate net-zero emissions goals. Yellen cited the Just Energy Transition Partnerships for Vietnam and Indonesia, financed by G7 countries, multilateral development banks and private sector investors as prime examples.

The meeting also includes discussions on developing carbon markets and Treasury's principles for financial firms' net-zero pledges that will require their lending and investments to align with goals to limit the global temperature increase to 1.5 degrees Celsius by mid-century, "responsible development" of digital assets.

Yellen is due to hold a closing news conference on Monday evening.

ISLAMABAD - Pakistan's interim administration has reached a key agreement with the International Monetary Fund (IMF) on an annual tax collection target of Rs 9,415 billion, a move that underscores the country's commitment to its economic goals without imposing new taxes. This understanding comes as part of the ongoing discussions under a $3 billion standby arrangement (SBA) that has already helped Pakistan stave off a potential sovereign debt default since July.

The IMF's mission chief, Nathan Porter, praised Pakistan for its progress towards economic recovery and adherence to first-quarter targets. The Federal Bureau of Revenue (FBR) has outlined comprehensive strategies to expand the tax net and meet the ambitious tax collection goals set by the IMF. These strategies include plans to combat tax evasion in the real estate sector, which is a significant step forward in enhancing administrative practices.

Dr. Shamshad Akhtar, the caretaker Finance Minister, has assured that there will be no additional tax burdens on citizens and highlighted the government's focus on fiscal prudence to control the budget deficit. She also discussed fiscal measures and strategies to address the issue of circular debt in the power sector with IMF representatives.

The IMF delegation began their assessment last week for the second tranche of the SBA loan, which is expected to continue until December 15. A positive review could release an additional $710 million for Pakistan in December. Dr. Akhtar expressed optimism about these discussions and emphasized the IMF's confidence in the caretaker government's program, which includes development expenditures aimed at improving the country's economic condition.

The agreement between Pakistan and the IMF signifies an important stride in Pakistan's economic strategy, with both parties acknowledging each other's efforts. The caretaker government's commitment to no new taxes and focus on administrative enhancements have been pivotal in these negotiations.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

A look at the day ahead in European and global markets from Kevin Buckland

Chip stocks gave Asian equity investors some small bit of cheer to start the week, picking up where Wall Street left off while U.S. yields stayed subdued, which kept a lid on the dollar, too.

But elsewhere, bears were firmly in control.

A lot of that can likely be traced to China, rather than to the Moody's (NYSE:MCO) downgrade to the outlook for the U.S. sovereign debt rating, which investors have taken in stride.

The Chinese consumer has so far refused to ride to the rescue of the world's second-largest economy. Monthly retail sales data is due on Wednesday but the country's Singles Day shopping extraganza over the weekend - equivalent to Black Friday sales elsewhere - recorded only meagre growth.

Looking across the region, Japan's tech-heavy Nikkei managed to keep its head above water, buoyed by gains for its two biggest chip-related shares; Taiwan's benchmark advanced 0.8%.

But Hong Kong flipped from early gains to a loss of about 0.15%. A sub-index of tech shares remained firmly positive but another of mainland property developers slumped more than 1%.

China's blue chips fell 0.5%.

U.S. retail sales data is also due on Wednesday, preceded by CPI a day earlier. The figures could be key in helping the Federal Reserve to plot the path ahead for interest rates, including whether another hike is needed.

The Fed's rhetoric has taken a hawkish turn recently, but markets so far are more focused on the data, particularly the soft non-farm payrolls numbers at the start of this month.

ECB President Christine Lagarde last week said that rates will stay restrictive at least for several quarters. Lagarde deputy Luis de Guindos has his say a little later today, giving the keynote speech to kick off Euro Finance Week.

Elswhere, Bank of England board member Catherine L. Mann will take the podium, after the bank's chief economist, Huw Pill, said last week its projection that monetary policy will need to remain restrictive for an extended period should not be taken as a promise.

Key developments that could influence markets on Monday:

-ECB's de Guindos, BoE's Mann speak

-UK Rightmove (OTC:RTMVY) house prices

-Sweden SEB housing

-New York Fed consumer expectations survey