Commerce and Industry Minister Piyush Goyal on Thursday suggested discussions on the carbon border adjustment tax with top steel industry leaders to promote sustainable manufacturing in the sector.
He also asked the steel industry to target 500 million tonnes in steel production by 2047. At present, the industry is eyeing 300 million tonnes by 2030.
The minister also suggested the sector find newer and better ways to lower carbon emissions and promote production of high quality steel in the country.
“Let’s try and utilise AI (artificial intelligence) to optimise our production, reduce waste, and improve efficiency across the value chain and work towards a circle economy in a bigger way,” he said, while addressing a steel conclave virtually.
On carbon tax, he suggested that four to five top leaders of the steel industry could sit in with him to deliberate on the subject.
The minister added that the government was not able to extend the benefits of the Remission of Duties and Taxes on Exported Products (RoDTEP) Scheme to the sector due to shortage of funds.
“Let’s make one more effort on the border adjustment tax… Imported steel which comes into India does not have to pay all these taxes (like coal cess and electricity duty). Border adjustment tax is a WTO (World Trade Organisation) complaint mechanism,” Goyal said.
“Electricity duty, any additional state levies or taxes that you are not getting remitted, which are not being charged in other countries, can be adjusted through a border adjustment tax. So let four to five (of) us sit down and take this dialogue forward,” Goyal said.
Goyal also asked the industry to inform the government of any unfair trade practices in other countries, so that India can also take retaliatory measures against those.
He asked the domestic industry to consume Made in India steel like in Korea and Japan. “Sadly, we don’t have a similar approach,” he said.
He further noted that the steel industry should come forward and suggest how free trade agreements can be made more beneficial for them.
India has not signed any FTA without 100% concurrence from the steel industry, and India has always included stringent rules of origin norms so that the domestic players are not discriminated against.
In July, the European Union (EU) suggested that India can devise its own mechanism instead of paying the carbon tax to the European Union.
Goyal had said that the ministry would consider the EU’s suggestion and come up with whatever is good for the Indian industry and for the people.
He added India is in dialogue with the European Union (EU) on the tax or Carbon Border Adjustment Mechanism (CBAM).
According to reports, an EU delegation has suggested to New Delhi that India could implement its own carbon tax and reduce carbon emissions.
The EU has decided to impose a CBAM, or carbon tax, which will come into effect from January 1, 2026. However, from October this year, domestic companies from seven carbon-intensive sectors, including steel, cement, fertiliser, aluminium and hydrocarbon products, would have to share data with regard to carbon emissions with the EU.
India has strongly criticised the move and is in dialogue with the EU on the issue.
