INDIA is pressing for an exemption from the UK's proposed carbon tax as negotiations progress towards finalising a free trade agreement, The Guardian reported on Friday (19).
A British government official, briefed on the negotiations, revealed that India is seeking exemption from the proposed carbon border adjustment mechanism (CBAM), citing its status as a developing country.
The tax was proposed to mitigate emissions and provide support to UK steel producers by ensuring fair competition with countries that impose lower or no carbon taxes.
India had previously expressed concerns regarding the implementation of CBAM, which entails a planned tax on the import of carbon-intensive goods such as steel, glass, and fertiliser.
According to the report, the tax would impact Indian steelmakers seeking to export to the UK.
The discussions this week continue the 14th formal round of negotiations between the countries.
India has additionally been seeking further concessions concerning visas for Indian workers and a social security agreement, both of which have been persistent matters in the negotiations. The discussions in London are scheduled to wrap up on Friday but may extend into remote sessions next week.
“There are very few pending issues left in the negotiation. A couple of key priority issues to seal the deal are being ironed out to have a balanced outcome," India’s commerce secretary, Sunil Barthwal, said earlier.
Meanwhile, during a debate in the House of Lords, foreign secretary David Cameron revealed that there has been good market access offered on both sides but not enough to secure a trade deal.
“My understanding of where we are with the trade deal is that good market access has been offered on both sides, but not quite enough yet to secure a deal. It is important with such trade deals, as you only really get one proper shot at it, to make sure that it is a good enough deal that will be welcomed by industry leaders here in the UK as offering real market access," he said.
A department for business and trade spokesperson said: “The UK and India continue to work towards an ambitious trade deal that works for both countries. While we don’t comment on the details of live negotiations, there are no plans to change our immigration policy to achieve this free trade agreement.
"The business and trade secretary has always been clear she will only sign a deal that is fair, balanced and ultimately in the best interests of the British people and the economy.”
The UK and India launched trade negotiations in January 2022 while Boris Johnson was prime minister.
