CBAM (Carbon Border Adjustment Mechanism)

The EU Carbon Border Adjustment Mechanism is a trade policy that puts a carbon price on imports of carbon-intensive goods (cement, iron/steel, aluminium, fertilisers, electricity, hydrogen) entering the EU. From January 2026, importers must purchase CBAM certificates reflecting the carbon price in the EU ETS. CBAM aims to prevent carbon leakage and level the playing field between EU producers (who pay for carbon) and foreign competitors. Indian, GCC, and other exporters to the EU face significant compliance obligations.