EU carbon border regime already applies as India weighs retaining carbon revenues
What happened
The EU's Carbon Border Adjustment Mechanism entered its definitive regime on January 1, 2026, following the 2023–2025 transitional phase. It is already in effect as of this September edition. The mechanism links specified imports to embedded emissions, while India is considering ways to retain carbon revenues domestically, according to ET Government.
Why it matters
Affected exporters need reliable emissions information for EU customers managing reporting and certificate obligations. Carbon costs can affect competitiveness. Domestic carbon pricing may influence where those costs are collected, subject to the EU's rules for recognising payments made abroad.
Bigger picture
CBAM links climate policy to trade in selected carbon-intensive goods, including cement, iron and steel, aluminium and fertilisers. It accompanies the gradual phase-out of free allowances under the EU emissions trading system.
Watch next
Watch current EU implementation guidance and India's domestic carbon-pricing decisions.