EU Carbon Border Adjustment Mechanism (CBAM)
The EU's CBAM entered its definitive phase on January 1, 2026, imposing a carbon-adjusted levy on imports of steel, cement, aluminium, electricity, fertilisers, and hydrogen. During the transitional phase (2023-2025), importers only had to report embedded emissions. From 2026, importers must purchase CBAM certificates equivalent to the carbon price that would have been paid under the EU Emissions Trading System (EU ETS). The mechanism aims to prevent "carbon leakage" where production shifts to countries with weaker climate policies.
- Definitive phase began January 1, 2026, with financial obligations on imports
- India's average steel emission intensity: approximately 2.5 t-CO2/tonne (vs EU benchmark of 1.8 t-CO2/tonne)
- Indian steel exports to the EU could face carbon charges of approximately EUR 270 per tonne under default values
- Steel accounts for 12% of India's national emissions (global average: 8%)
- Indian steel company profitability on EU exports projected to decline 25-30% post-CBAM
● Tracked since February 16, 2026 · last seen August 27, 2026 · updates as the daily brief publishes
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