Name: EU’s carbon border tax risks trade war with China and India
Uploaded: 2026-01-01T15:21:51.913Z
Duration: 2 min 11 s
Description: The EU carbon border tax targets high-emission imports, pressuring China and India to go green, curbing offshoring but likely raising EU prices.

The EU carbon border tax targets high-emission imports, pressuring China and India to go green, curbing offshoring but likely raising EU prices.

Brussels

The European Union has introduced the Carbon Border Adjustment Mechanism, a new tax aimed at imports from countries such as China and India, particularly affecting products like aluminum, cement, fertilizers, and steel. The EU's goal is to encourage cleaner production methods abroad and prevent European companies from relocating to countries with lower environmental standards.

China and India have criticized the measure as a unilateral move by the EU, warning of the risk of a trade dispute. The policy may also lead to higher prices for some consumer goods within Europe, as all trading partners will be required to meet EU environmental standards.

EU’s carbon border tax risks trade war with China and India

The Carbon Border Adjustment Mechanism is a new tax which is going to be now implemented here in Europe and it targets in particular Chinese and Indian exports to the EU, particularly aluminum, cement, fertilizers and steel. The Europeans believe that these products in particular are produced in an environment that contributes to greenhouse gas emissions and therefore pollutes the air. They want to target these products by a new carbon price to put more pressure on the Chinese and the Indians to invest more in clean technology and also in emissions tracking systems. That's number one. Number two, they want to prevent European companies from relocating to China and India where the costs are lower compared to the EU and they want to provide a fair competition for European companies. And the Europeans are sending here a political message at the same time which is basically they're using their leverage to tell the other countries such as India, China, Russia, Brazil and South Africa that it's about time to contribute to the push to create a better world with renewable energy, less pollution or you will risk a share in the European market. But ultimately this is a move that may lead to an increase in some of the products for the Europeans themselves particularly when it comes to garden tools, kitchen stoves, refrigerators and also car components. The Chinese and the Indians were very upset with this new tax. They hit back and said this is a unilateral approach by the Europeans. But from a European perspective there is a consensus that everyone who wants to do business with the Europeans has to meet the EU environmental standards. Hash Mahbara, Al Jazeera, Brussels.

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