While Indian steel exports will continue to be affected by the European Union's Carbon Boundary Adjustment Mechanism (CBAM), the Indian government will take steps to help steel companies maintain overseas shipments to the region, Steel Ministry Secretary Sandeep Poundrik said on Wednesday, February 11.
Mr. Poundrick made this statement against the backdrop of the signing of the Free Trade Agreement (FTA) between India and the EU, reducing tariffs between sectors, but without affecting tariffs under CBAM. The EU accounts for about 75 percent of India's total steel exports to Europe.
"With CBAM and tariff quotas and other issues, exports will remain a problem and we will have to take action," Poundrick said.
However, he did not specify the outlines of the government's proposed actions. But government sources said that various options were being considered and that meetings had already taken place between representatives of the Ministry of Steel and their counterparts at the Ministry of Commerce, who were negotiating the India-EU FTA and finalizing various provisions in accordance with it.
It was noted that one option is to create a steel export incentive scheme to offset the impact of CBAM, but this should be calibrated so that it does not violate the WTO's anti-subsidy provisions.
