July 3: Indian industry leaders are urging the government to strengthen the country’s carbon markets, as the European Union’s Carbon Border Adjustment Mechanism (CBAM) begins to reshape global trade dynamics.
They warn that the EU’s carbon-linked import tax is pushing exporters to account for emissions more strictly, which could affect the competitiveness of Indian goods in international markets if domestic systems are not strengthened in time.
Experts say a well-functioning carbon trading system in India would help industries manage rising compliance costs while also encouraging cleaner and more efficient production practices.
Sectors such as steel, cement, and chemicals are expected to feel the impact the most, as they are highly emissions-intensive and closely linked to export demand.
Industry representatives are now calling for faster policy action to build a stronger carbon market framework, saying it is essential for protecting trade interests while supporting India’s long-term climate commitments.