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Will take up EU's carbon tax issue strongly: Piyush Goyal

He also said that simultaneously, India will strengthen and prepare itself to convert the issue into an opportunity.
Last Updated 23 February 2024, 10:57 IST

New Delhi: Commerce and Industry Minister Piyush Goyal on Friday said that India will take up the carbon tax issue 'very' strongly with the European Union (EU) and address it with the 27-nation bloc.

He also said that simultaneously, India will strengthen and prepare itself to convert the issue into an opportunity.

Non-tariff barriers and unilateral measures like carbon taxation are issues of concern for India, but the country will be a responder in a free and fair manner within the rules of international trade.

"Where we have to retaliate, we will retaliate; where we have to take countermeasures, we will take countermeasures; where we have to have conversations, discussions and solve issues bilaterally, we will discuss and solve them and where we have to take it up legally, we will do that," Goyal said at the Raisina Dialogue 2024.

Citing an example, he said the CBAM (Carbon Border Adjustment Mechanism) has been a matter of concern for different businesses.

"CBAM is something we will take up very strongly within the rules of the WTO (World Trade Organisation), we will be addressing that issue bilaterally also with the EU," Goyal said.

The CBAM or carbon tax (a kind of import duty) will come into effect from January 1, 2026. Companies from seven carbon-intensive sectors, including steel, cement, fertiliser, aluminium and hydrocarbon products, may have an impact from this tax.

According to a report of think tank Global Trade Research Initiative (GTRI), CBAM will translate into a 20-35 per cent tax on select imports into the EU starting January 1, 2026.

India's 26.6 per cent of exports of iron ore pellets, iron, steel, and aluminium products go to the EU. These products would be hit by CBAM. India exported these goods worth $7.4 billion in 2023 to the EU.

He added that India would convert this into 'our advantage. We have plans, (but) I can not disclose...but I can assure each and every person in India that the prime minister and his team will ensure that Indian business does not suffer and we are right on top of the issues such as this'.

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(Published 23 February 2024, 10:57 IST)

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