Congress general secretary Jairam Ramesh
Credit: PTI Photo
New Delhi: Congress on Thursday called the carbon tax imposed by the European Union on Indian exports of steel and aluminium "unacceptable" and asked the Modi government to keep this non-tariff barrier in mind while finalising the India-EU Free Trade Agreement (FTA).
Congress General Secretary (Communications) Jairam Ramesh said the much-awaited India-EU FTA will reportedly be finalised later this month.
Beginning Thursday, he said, Indian steel and aluminium exporters to the 27-nation European Union will have to pay a carbon tax under the EU's Carbon Border Adjustment Mechanism (CBAM).
"In FY 2024-25, our exports of steel and aluminium to the EU averaged USD 5.8 billion — having already fallen from USD 7 billion in the previous year as EU importers began preparing for the introduction of the CBAM," he said.
Citing the think-tank GTRI's estimate, he said many Indian exporters may have to cut prices by 15-22% so that their EU importers can use that margin to pay the carbon tax.
"In addition, the documentation requirements call for meticulous accounting for and reporting of carbon emissions that are adding further costs to Indian exporters. Any India-EU FTA that does get finally signed must account for this unacceptable non-tariff barrier," he said on 'X'.