India's Steel Sector Faces Challenges

Starting January 1, 2024, Indian steel and aluminium exports to the EU will face a new carbon tax called CBAM.

This tax is based on how much carbon is released when making these products.

The EU wants to encourage cleaner production, so they're charging more for dirtier products.

Indian exporters might need to lower their prices by 15-22% to stay competitive.

Small businesses, called MSMEs, might struggle because they rely on bigger companies for their materials.

The Indian government and industry groups need to take action to help these exporters adjust to the new rules.

This includes measuring and verifying their carbon emissions, updating contracts, and maybe even getting some financial help from the government.

Additionally, industry bodies like CII and Assocham have suggested various measures to improve the competitiveness of the steel sector, such as reducing customs duties, improving customs clearance processes, and promoting low-carbon production technologies.