India ramps up preparedness for European Union's carbon tax; verifiers begin EU registry access

New Delhi: India has stepped up preparations to help exporters comply with the European Union's Carbon Border Adjustment Mechanism (CBAM), with the commerce ministry setting up a committee comprising representatives from key ministries and departments, regulators and industry bodies, a senior official said on Tuesday.

The commerce ministry has set up the Committee on Export Preparedness for EU CBAM. It was constituted under the chairmanship of an additional secretary-level officer, bringing together key ministries/departments, regulators and industry bodies.

Additional Secretary in the Department of Commerce Darpan Jain said that Indian verifiers can now access the EU CBAM, a kind of carbon tax registry, from this month, but the mandatory filing of returns by domestic exporters will take place from September 2027.


"So, the verification process through verifiers has started in September of this year. But the actual returns have to be filed by September of 2027," Jain told reporters here.

CBAM is a carbon tax announced by the EU on goods emitting carbon during their manufacturing processes, such as fertiliser, iron and steel goods, aluminium and cement. Under this, the EU will charge a carbon tariff on selected imports, using the EU Emissions Trading System (ETS) price and adjusting for any carbon price already paid in the exporting country.

"In this backdrop, we have been engaging with the exporters in terms of creating awareness about how they should get their embedded emissions verified and take steps to file the returns.

"We have conducted a training programme also, and a business programme also. And, we have also engaged with the EU side on how our national accreditation body can be accredited. And also, how our verifiers can be accredited. So, on both these actions, we have engaged with the EU side," Jain said.

He informed that some verifiers from India have already filed applications with the EU agencies.

"We expect that some verifiers from India will get accreditation very soon, which will enable us to have verification agencies in India itself," he added.

These verifiers would check whether the carbon emissions data reported by exporters is accurate and compliant with EU CBAM rules.

Commerce and Industry Minister Piyush Goyal has written to the EU Commissioner for Trade and Economic Security seeking recognition of NABCB (National Accreditation Board for Certification Bodies) as an accreditation body for CBAM verifiers.

"On Europe, we are engaged, and we have been discussing with our exporters as to how we should ensure that compliance is easy," he added.

To comply with the UK's CBAM, which will enter into force from 1st of January 2027, Jain said Britain has recognised India's accreditation body - NABCB.

The certification which is given by this body will be recognised by the UK side.

"Second, they have also accepted the carbon payments which are made in India under the Carbon Credit Trading Scheme (CCTS) framework," he said.

Under this framework, certain industries are covered. To the extent of the payments which they would make on embedded carbon, those would be offset against the payments which are to be made in the UK.