The EU's Carbon Border Adjustment Mechanism entered its definitive phase in January 2026, requiring importers to purchase CBAM certificates covering verified embedded emissions. Indian manufacturers face steep default-value penalties if they lack auditable plant-level carbon data. For steel, aluminium, and cement exporters, carbon footprint assessment has shifted from a sustainability talking point to a direct cost on every shipment. India's iron and steel exports to the EU dropped 24.4% between FY24 and FY25, partly due to unmeasured carbon costs. Blast-furnace steel faces a CBAM cost of roughly 254 euros per tonne under EU defaults, while electric-arc-furnace steel from Turkey pays about 100 euros. The gap between verified emissions and default values is the single biggest lever manufacturers control. A proper carbon footprint assessment follows the GHG Protocol, covering Scope 1, 2, and 3 emissions using India-specific factors from the Central Electricity Authority. Manufacturers that build installation-level data collection systems and engage ISO 14065 compliant verifiers early will be better positioned to meet both CBAM requirements and India's BRSR Core mandate.
