CBAM guide for Indian exporters
Short answer: CBAM is the EU's Carbon Border Adjustment Mechanism. Since 1 January 2026 EU importers of covered goods (cement, iron and steel, aluminium, fertilisers, electricity and hydrogen) must pay for the carbon emitted making them. As an Indian exporter you are not the one who pays, but your EU buyers need verified emissions data from you, and buyers who cannot get it may switch suppliers.
What is CBAM?
The Carbon Border Adjustment Mechanism (CBAM) puts a carbon price on certain goods imported into the European Union. The aim is to make imported goods carry a similar carbon cost to goods made in the EU, which already pay under the EU Emissions Trading System (EU ETS).
What changed on 1 January 2026?
From October 2023 to December 2025, CBAM was in a transitional period: importers only had to report emissions, with no payment. The definitive period began on 1 January 2026. Under current rules, EU importers must be authorised CBAM declarants, report the embedded emissions of their imports, and surrender CBAM certificates to cover them. Importers bringing in more than 50 tonnes of covered goods per year (net mass, across all CN codes) must become authorised CBAM declarants; smaller importers are largely exempt. Certificate sales start on 1 February 2027, and the first annual declaration, covering 2026 imports, is due by 30 September 2027.
Which goods does CBAM cover?
| Sector | Examples |
|---|---|
| Iron and steel | Pig iron, ferro-alloys, flat and long steel products, tubes, pipes, bolts and screws |
| Aluminium | Unwrought aluminium, bars, sheets, foil, wire, structures |
| Cement | Cement clinker, Portland and aluminous cement |
| Fertilisers | Ammonia, nitric acid, urea, mixed fertilisers |
| Electricity and hydrogen | Imported electricity, hydrogen |
Scope is decided by the EU customs code of the product, not by what the product is called. See our guide to CN code mapping. On 17 December 2025 the European Commission proposed adding about 180 steel- and aluminium-intensive downstream products, to apply from 1 January 2028 if adopted. It is a proposal, so check its current status.
Do Indian exporters pay CBAM?
No. The legal obligation to buy CBAM certificates sits with the EU importer. In practice the cost is passed back through pricing and contracts, and importers need accurate emissions data from you to avoid being charged on conservative default values. That is why exporters are being asked for data now.
What data will your EU buyer ask for?
- Product details and the EU customs (CN) code
- Production quantities per product and per installation
- Direct emissions from fuel and process use
- Electricity consumed and its source (only needed for cement and fertilisers, where indirect emissions count)
- Emissions embedded in key raw materials (for example scrap, pig iron or alumina)
- Evidence: invoices, meter readings, bills, and third-party verification of installation data when you report actual rather than default emissions
Read more in how embedded emissions are calculated.
A practical 6-step plan
- Check scope. Map each product to its EU CN code and see if it is covered.
- Ask your buyers what format and deadlines they need.
- Gather evidence once: production, energy and raw-material records per installation.
- Calculate embedded emissions using the official methodology, not estimates.
- Get data verified by an accredited verifier if you want actual (not default) values to be used.
- Keep an audit trail so each figure links back to a source document.
Why this matters commercially
Suppliers who can hand over clean, verified data are cheaper and lower-risk for EU buyers. Suppliers who cannot may be priced using default values, which tend to be less favourable, or replaced.
Frequently asked questions
Is CBAM live in 2026?
Yes. CBAM entered its definitive period on 1 January 2026, so EU importers of covered goods now have financial obligations, not just reporting.
Do Indian exporters have to pay CBAM?
No. EU importers buy and surrender the CBAM certificates. Indian exporters supply the emissions data those importers need, and may feel the cost through pricing.
Which Indian exports are affected by CBAM?
Mainly iron and steel, aluminium, cement and fertilisers exported to the EU, directly or through traders. Scope depends on the product's EU customs code.
Not sure which rules apply to you?
Book a free 30-minute compliance readiness call. We will check your products against CBAM and leave you with a simple action list.
Book a free callRelated guides
Official sources: European Commission CBAM page · CBAM definitive regime · CBAM verification · Regulation (EU) 2025/2083. Reviewed against these on 2026-10-18.
Regulatory details change. This page is general information, not legal advice. Check the official EU sources and your customs broker before acting.