EU Carbon Border Tax Kicks In, Indian Exporters Brace for Impact

CBAM applicable to exports of several industries like cement, steel, etc to EU from Oct 1
Transitional phase kicks in, small businesses apprehensive of disruptions
Carbon levy transition period starts, industrial goods trade may be impacted
EU's carbon border tax to be implemented in phases over 3 years
Indian companies preparing for new EU regulations, assessing potential impact

business-standard.com

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8/19/2023

India prepares own carbon trading system and decarbonisation measures to counter EU’s CBAM

### Summary India is planning to establish its own carbon trading system and implement measures to encourage decarbonisation in high-emission industries to mitigate the impact of the Carbon Border Adjustment Mechanism (CBAM) by the EU. Efforts will be made to keep MSMEs out of the CBAM's scope, and a national framework for the Indian Carbon Market (ICM) will be developed. ### Facts - 🌍 India is considering setting up its own carbon trading system and implementing measures to support decarbonisation in high-emission industries. - 🏭 "Hand-holding" will be provided to industries, specific definitions and auditing standards will be established, and certification processes will be conducted. - 🤝 Select Ministries, such as Commerce & Industry and External Affairs, will advocate for India's position on CBAM at international forums. - 💼 The government plans to develop the Indian Carbon Market (ICM) and recently notified the Carbon Credit Trading Scheme 2023. - ⏳ Market codes, regulations, and actual trading in the ICM are still under consideration and some time away. - 💰 The carbon credit trading system rewards entities that transition to low-carbon practices with carbon credits and imposes penalties on those falling short. - 📢 Steel and mines ministries have been asked to sensitize their stakeholders on the CBAM's impact as it enters the transitional phase from October 1. - ✅ India is in talks with the EU to allow energy auditors from the country to verify carbon-intensive exports. - 🌱 Several steel companies, including Tata Steel, JSPL, and JSW, have implemented decarbonization initiatives such as hydrogen injection, solar power utilization, CO2 capture plants, and green hydrogen plants. - ⚡️ India's emission intensity in crude steel production is higher than the global average. - 💡 The government is engaging with think tanks, S&T bodies, and Ministries to discuss and recommend decarbonization measures. - 👥 Collaboration between ONGC, Equinor, and Shell is underway for CO2 capture and utilization projects in India. - 🌿 Initiatives to scale up Net-Zero Technologies like Carbon Capture and Storage (CCS) plants are being implemented. - 🏭 Union Power Minister, RK Singh, highlighted the importance of reducing carbon content in exports to Europe, with a focus on green steel and green hydrogen. - 🔋 JSW Steel is engaged in discussions with global partners and the EU, and plans to increase renewable energy capacity and reduce thermal coal usage. Source: businessline

9/14/2023

China Warns EU Carbon Border Tax May Violate WTO Rules

China has urged the European Union to ensure that its proposed carbon border adjustment mechanism complies with World Trade Organization rules and does not create protectionist measures or green trade barriers.

10/1/2023

EU Begins Carbon Border Tax Trial Amid Concerns Over Impact

The EU's carbon border tax, aimed at ensuring fair competition and encouraging other countries to price carbon, enters a trial period, raising tensions with key trading partners and facing criticism for potential impacts on businesses and vulnerable countries.

10/18/2023

ECB Begins 2-Year Preparation for Possible Digital Euro Launch

The European Central Bank (ECB) is moving its digital euro project to a preparation phase, which could lead to a potential decision to issue a central bank digital currency (CBDC) in the future, following the completion of relevant EU legislation.

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Posted 10/1/2023, 11:36:21 AM