After a two-year transitional reporting phase, the EU’s Carbon Border Adjustment Mechanism (CBAM) enters its definitive regime in January 2026. Importers of covered goods (iron and steel, cement, aluminium, fertilisers, electricity, and hydrogen) will need to purchase CBAM certificates corresponding to the embedded emissions of their imports.
For Indian exporters, the stakes are high. India is a major supplier of steel and aluminium to EU markets, and the carbon intensity of Indian production generally exceeds EU benchmarks. Without action, CBAM could add 8–15% to the cost of Indian steel exports to Europe.
The mitigation strategy has three pillars: (1) reduce carbon intensity through process improvements, fuel switching, and renewable energy; (2) establish robust GHG monitoring and reporting systems that meet CBAM verification requirements; (3) explore whether domestic carbon prices (CCTS credits) can be deducted from CBAM obligations.
RSustain’s CBAM practice — available through our CBAM Compass tool on india.rsustain.com — helps exporters assess their exposure, calculate embedded emissions per product, and develop compliance roadmaps. We combine carbon accounting expertise with trade compliance knowledge to provide integrated advisory.
CBAM is the first major example of climate policy becoming trade policy. It will not be the last. Companies that build robust carbon measurement and reduction capabilities now will be better positioned for whatever comes next.