New Delhi, May 18 (KNN) India needs to adjust its domestic industries to adhere to non-tariff barriers like the European Union's Carbon Border Adjustment Mechanism (CBAM) in order to remain competitive globally, NITI Aayog CEO BVR Subrahmanyam stated on Friday.

Speaking at the Confederation of Indian Industry's Annual Business Summit 2024, he emphasised the necessity for India to integrate into global value chains by reducing tariffs and streamlining cross-border procedures.

"India is not significantly involved in global value chains currently. Joining them requires fundamental changes, including lowering tariffs, minimising procedures to enable seamless cross-border movement of goods," Subrahmanyam remarked.

He advocated for India to sign more free trade agreements with key trade partners and cautioned against protectionism, stating sectors shielded from competition tend to stagnate.

On the CBAM, which imposes levies on carbon-intensive imports like steel and cement into the EU, Subrahmanyam clarified that such non-tariff barriers apply equally to domestic and foreign industries.

"If a society imposes conditions related to labor, environment or other issues, industries must adapt to remain competitive in that market," he explained.

Subrahmanyam also highlighted the need for expediting legal processes to stimulate greater private investments in infrastructure projects within India.

Data indicates India's average tariff levels have risen to 18.1 per cent in 2022 from 13 per cent in 2014, adversely impacting the nation's competitiveness compared to rivals like Vietnam, Thailand and Mexico.

(KNN Bureau)