Reporting phase of EU carbon tax kicks in for firms

FROM OCTOBER 1, the Indian exporters of steel and aluminium to the European Union will have to keep a record of carbon emissions at the production stage as the reporting phase of carbon tax kicks-in.

- MUKESH JAGOTA

However, most exporters are unprepared for the task, a report by a trade policy think tank said.

"Only a few have undergone emission audits for their facilities.

Many are hoping for a last-minute deal between the government and the EU that allows them to continue business as usual," co-founder of Global Trade Research Initiative Ajay Srivastava said.

The issue of unpreparedness and complications in the carbon reporting process has been brought to the attention of the government by exporters in their meetings with the officials. Many have requested the government to intervene to get exemptions from the EU at least for smaller and medium production units.

Small firms often purchase steel or aluminium from larger firms and use them to create export products.

These small firms will require emission data from the large firms. However, it appears that many large Indian firms are reluctant to share this data, which could lead the EU to calculate taxes based on default or maximum values.