Posted on 05 Oct 2023
India’s government has assured domestic steelmakers that it is looking at ways to address their concerns about the EU’s planned tariffs on imports of high-carbon goods and is discussing the issue with its European counterparts, a government official said.
“We are discussing with stakeholders and continuing to look at ways in which India’s trade interests in steel could be safeguarded,” Nagendra Nath Sinha, the most senior civil servant at the federal Ministry of Steel, told Reuters in an interview on Tuesday.
“(India’s) government has raised its concerns at both bilateral and multilateral levels with the EU,” he said, adding the tariffs would impact India’s steel exports.
The European Union this year approved the world’s first plan to impose tariffs on imports of high-carbon goods including steel and cement as part of its aim to reach net zero greenhouse emissions by 2050.
The proposal has caused widespread unease among top exporters of commodities such as steel to the EU.
India’s industry officials have warned that exports worth billions of dollars would face steep tariffs.
The Carbon Border Adjustment Mechanism (CBAM) through which the EU plans to impose the tariffs ranging from 20% to 35% comes into effect from 2026.
Exporters to the European Union will then need to purchase certificates to cover carbon emissions to put foreign producers on a level footing with EU industries that must buy permits from the bloc’s carbon market when they pollute.
Research group Wood Mackenzie in a recent report said that by 2034, the cost of India’s steel exports to the EU would rise by 56% due to CBAM.
As part of an initial phase of the CBAM, the 27-nation bloc has already asked EU importers to report the greenhouse gas emissions embedded during the production of their goods such as steel.
Source:Reuters
