Nirmala Sitharaman Calls EU's Carbon Tariffs ‘Unilateral’ And ‘Arbitrary’

ENA Sectors 2024-10-10 17:02:12 New Delhi, Oct 10 (KNN) In a recent address at an event, Finance Minister Nirmala Sitharaman expressed strong criticism of the European Union's proposed Carbon Border Adjustment Mechanism (CBAM) and Deforestation Act. Sitharaman characterised these measures as unilateral and arbitrary, asserting that they could potentially harm Indian industries and disrupt global supply chains. The Finance Minister highlighted India's commitment to climate action goals, emphasising the country's proven track record in meeting its environmental obligations. She argued that facing such unilateral measures from developed countries poses a significant challenge, particularly for nations like India that are already investing heavily in transitioning towards more sustainable practices. Sitharaman questioned the fairness of the CBAM, describing it as a trade barrier that might be justified to the World Trade Organisation on environmental grounds. She raised concerns about its compliance with WTO regulations, though acknowledging that it could potentially be deemed compliant. In her conversation with John Reed, the Financial Times' South Asia Bureau Chief, Sitharaman pointed out what she perceived as a contradiction in the EU's approach. She suggested that while imposing tariffs on what the EU defines as dirty steel from other countries, the bloc itself might continue to produce such steel, using the revenue generated from these tariffs to fund its own transition to greener production methods. The Finance Minister confirmed that India's concerns regarding the CBAM have been voiced during Free Trade Agreement negotiations with the EU and would be raised again. However, she indicated that this issue is unlikely to escalate to a point where it might jeopardise the ongoing trade talks. The CBAM, set to take effect from January 1, 2026, is a carbon tariff targeting carbon-intensive products imported into the EU, including steel, cement, and certain types of electricity. A trial period for the mechanism began on October 1, 2023, requiring companies in seven carbon-intensive sectors to share emissions data with the EU. Sitharaman underscored India's progress towards its net-zero goal, stating that the country is on track to meet its 2030 climate action targets. She noted that India's per capita emissions are significantly lower than the global average and emphasised the country's consistent efforts to promote renewable energy sources. In conclusion, the Finance Minister reaffirmed India's commitment to environmental sustainability, stating that the country is allocating resources appropriately to address climate challenges. However, she maintains that external factors, such as the EU's proposed measures, present significant hurdles for India's industries and economic development. (KNN Bureau) 39560 https://knnindia.co.in/news/newsdetails/sectors/nirmala-sitharaman-calls-eus-carbon-tariffs-unilateral-and-arbitrary 2024-10-10 17:02:12 knnindia.co.in Nirmala Sitharaman Calls EU's Carbon Tariffs ‘Unilateral’ And ‘Arbitrary’