BRICS calls EU’s carbon tax ‘punitive, unilateral’, Pg12

Key Highlights:

• BRICS countries collectively opposed the European Union’s Carbon Border Adjustment Mechanism (CBAM), labeling it "punitive, unilateral, discriminatory, and protectionist".
• This stance was articulated in a joint statement from the 12th BRICS Environment Ministers’ Meeting held in New Delhi under India's chairship.
• CBAM officially entered its definitive phase on January 1, 2026, requiring importers of carbon-intensive products like iron, steel, and cement to account for associated emissions.
• BRICS nations also called for a significant increase in international adaptation finance from developed countries for developing nations.

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Detailed Insights:

• The BRICS statement highlighted concerns that measures like CBAM could hinder developing countries' efforts in climate change mitigation and building resilience.
• CBAM is designed by the EU to prevent "carbon leakage," which is the relocation of carbon-intensive production to regions with less stringent climate policies.
• India is particularly exposed to CBAM, with iron and steel exports accounting for approximately 90% of its affected trade with the EU.
• Analysis indicates that high-emission Indian steel firms reduced exports to the EU during the CBAM reporting phase, while lower-emission firms maintained their levels.
• The call for increased adaptation finance specifies that support should be "new, additional, predictable, adequate, and accessible," provided through grants and concessional finance.
• Ministers urged developed countries to fulfill the commitment made at the 2025 UN climate conference (COP30) to triple adaptation finance for developing countries by 2035.

Key Concepts Involved:

• Carbon Border Adjustment Mechanism (CBAM): An EU policy that imposes a carbon price on imported goods to ensure that the carbon cost of production is equivalent to that within the EU.
• Carbon Leakage: The phenomenon where companies move carbon-intensive production to countries with weaker emission regulations to avoid domestic carbon costs.
• Adaptation Finance: Financial resources provided to help countries and communities adjust to the adverse impacts of climate change, such as through infrastructure and water security projects.
• BRICS: An intergovernmental organization comprising Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran, Saudi Arabia, United Arab Emirates, and Indonesia, aiming to enhance cooperation among emerging economies.