- India plans local carbon tax to support green energy transition.
- EU’s carbon levy on high-carbon goods causes concern, triggering talks.
India plans to tax high-carbon goods locally. The goal is to support its green energy transition and avoid the EU’s carbon tax on imports. The EU approved a carbon levy on high-carbon goods like steel and iron ore in April, causing concerns in India. Talks are underway to address this issue.
Trade minister, Piyush Goyal, stated that if exporting nations tax carbon locally, there won’t be an additional levy. The solution lies in using domestic taxes to align with European carbon taxes. By collecting the tax in India and investing it in the energy transition, India and its exporting companies benefit. This move can reduce the need for the Carbon Border Adjustment Mechanism (CBAM) tax.