A significant meeting on CBAM, which will be attended by top officials from the ministries of finance, commerce and industry, steel, MSME, and industry leaders, is likely to be held soon
Non-EU steel manufactures will have to report direct and indirect emissions under the EU tax structure that may impose a 20%-35% duty on select imports from January 1, 2026. The EU importers must acquire CBAM certificates that cover the carbon footprints associated with manufacturing imported steel products. India has put forward various options to combat CBAM and has initiated bilateral talks with the US and EU regarding the issue.
In anticipation of increased scrutiny placed on its iron, steel, and aluminium exports to the EU under the EU's Carbon Border Adjustment Mechanism (CBAM), which is set to go into effect in October, India has urged the European Union to recognise its Carbon Credit Trading Scheme (CCTS).
The topic is anticipated to be covered at a crucial conference on CBAM that will include leaders from the industry, top officials from the ministries of finance, commerce and industry, steel, and MSME. The meeting will take place soon.
Non-EU steel firms will have to report direct and indirect emissions under the proposed EU tax drill. Starting on January 1, 2026, the method will result in a 20–35% tax on a limited number of imports into the EU. After that time, importers into the EU will need to declare and buy CBAM certificates to cover the emissions caused by the production of imported steel products.
Based on registered entities' efforts to decrease their carbon footprint, the government issues Carbon Credit Certificates, each of which represents a reduction or removal of one tonne of carbon dioxide equivalent.
A framework for the Indian carbon market is what the CCTS intends to establish. The plan has not yet taken its final form.
The World Trade Organisation (WTO) has previously been informed by New Delhi that carbon border restrictions are only being applied to "trade-exposed industries" such steel, aluminium, chemicals, plastics, polymers, chemicals, and fertilisers. This illustrates the fundamental worries about competitiveness that underpin such restrictions.
An Inflation Reduction Act to create green technology firms has also been authorised by the US.
According to another official, India has been looking into other options to combat CBAM, such as possible forms of retaliation, bringing the matter up at the WTO, or providing assistance to MSMEs. India has put forward various options to combat CBAM and has initiated bilateral talks with the US and EU regarding the issue.