COP31: EU FTA on horizon, but India won't budge on CBAM

New Delhi: Even as India readies to sign an ambitious free trade agreement with the European Union next month, it will adhere to its position opposing all trade- and cost-linked barriers including the EU's Carbon Border Adjustment Mechanism (CBAM) at COP31 in Turkiye, Union environment minister Bhupender Yadav said ahead of the global climate conference. "Participation in carbon markets should remain voluntary," Yadav said at a press interaction. "On CBAM, we will stand by our position. When it comes to protecting India's interests, that is what we speak about most strongly," he said.

The minister said barriers linked to cost, intellectual property and trade must be done away with as these prevent smaller countries from getting the benefit of better technologies. India and the EU are expected to sign the FTA by mid-December. The agreement would allow duty-free access to several of India's labour-intensive sectors such as leather, textiles, gems and jewellery, besides tariff concessions to a large segment of EU imports.

The highly contested CBAM regime, which came into effect in January 2026, remains a prickly point as it impacts several Indian sectors from iron and steel to fertilisers, hydrogen and electricity, cement and aluminium among others. CBAM, in fact, will persist as a major point of contention at COP31, as developing nations, the G77 and the BASIC group have repeatedly been raising concerns over unilateral trade barriers besides climate finance and just transition concerns. India is part of all three blocs. The European Commission, on its part, is expected to host an event at COP31 on November 17, titled 'The State of the EU CBAM: What makes CBAM a success?'.


Another flashpoint between developing nations and the EU could emerge over its strong pitch for clean, or non-fossil, fuel-linked 'electrification' - a proposal mooted by COP31 presidency Turkiye to increase electricity's share in global energy consumption from 23% to 35% by 2035. Speaking to reporters, Yadav, however, sought to emphasise that voluntary initiatives under the Presidency Action Agenda should remain separate from negotiations and that "uniform global targets must respect national circumstances".

Turkiye is hosting the UN Climate Change Conference (COP31) in the city of Antalya from November 9 to 20. Australia acts as the president of negotiations. Yadav underlined that India would play a constructive, bridge-building role in Antalya, seeking an outcome that moves from commitments to implementation and support. Yadav, however, also reminded of the centrality of climate finance - an obligation of developed countries under Article 9.1 that must be "predictable, largely public and concessional, and should not add to the debt burden".

India's engagements at COP31 will include LeadIT 3.0 with Sweden, in addition to high-level side events on coastal resilience, panels on the International Big Cat Alliance and forests.