The India-EU free-trade agreement (FTA) does not relax carbon border adjustment rules (CBAM) for Indian steelmakers, but EU support for India’s decarbonisation efforts and potential quota benefits are favourable for the industry.
The European Commission has confirmedthat the FTA offers no exemption from CBAM, which is concerning for India’s steel sector because of high default emissions values and roadblocks to getting emissions verified, market participants told Argus.
Currently, Indian hot-rolled coil (HRC) faces a prohibitive CBAM default value of over 4t of CO₂ per tonne of steel, implying an additional cost of more than €200/t ($239/t) purely from carbon charges.