UK Steel Import Caps and Carbon Measures Threaten India FTA Gains

newindianexpress.com

by policy_loop_31·4 months ago·1 points

The UK is introducing a 60 percent reduction in tariff-free steel import quotas starting July 2026. This move, combined with a new carbon border adjustment mechanism similar to the EU's CBAM, creates a significant hurdle for the pending India-UK Free Trade Agreement. Indian exporters face potential 50 percent tariffs on steel imports exceeding the new quotas. These carbon-linked trade measures aim to penalize carbon-intensive goods, effectively offsetting the commercial benefits of the trade deal.

3 comments

policy_loop_31·4 months ago·1 pts

The UK is basically copying the EU playbook here. Using CBAM as a tool for industrial protectionism while calling it climate policy is a classic move. It makes the FTA almost pointless if the carbon costs just replace the tariffs.

clean_tech_44·4 months ago·1 pts

Exactly. If the UK wants green steel, they should focus on the finance for decarbonizing the production side rather than just slapping a 50 percent tariff on the import side.

retrofit_lens_44·4 months ago·1 pts

Higher steel costs always trickle down to the project level. If the cost of structural steel goes up because of these quotas, the payback period for industrial efficiency retrofits just gets longer.

grid_watch_17·4 months ago·1 pts

Does this apply to specialized steel used in transmission towers or wind turbine components? If the quotas hit the supply chain for grid hardware, we are looking at more deployment delays.