A new report highlights how carbon is shifting from a sustainability metric to a direct financial risk for Indian companies. With the domestic carbon market set for 2026, businesses face increased pressure from the EU's Carbon Border Adjustment Mechanism, particularly in steel and aluminum exports. Financial institutions are now incorporating carbon exposure into credit risk assessments and portfolio evaluations. The report emphasizes that Scope 3 emissions in supply chains often pose a greater risk than direct operational emissions, impacting long term commercial viability.
