India is negotiating with the European Union to secure official recognition for the National Accreditation Board for Certification Bodies (NABCB) to handle carbon footprint verification. This move aims to simplify compliance for Indian steel, aluminium, and cement exporters ahead of the mandatory CBAM return filing deadline in September 2027.
The Indian government is engaged in high-level talks with the European Union to secure formal recognition for the National Accreditation Board for Certification Bodies (NABCB). If successful, this accreditation would allow Indian verification agencies to certify the embedded carbon emissions of domestic goods. This is a critical step for Indian exporters, particularly in the steel, aluminium, and cement sectors, as they prepare for the European Union's Carbon Border Adjustment Mechanism (CBAM).
Currently, Indian exporters face significant logistical and financial hurdles in proving the carbon intensity of their products. Without local verification, companies may be forced to rely on international agencies, which can increase costs and complicate the reporting process. The Union Commerce Ministry, through its newly formed Committee on Export Preparedness, is working to streamline this infrastructure. Access to the EU's CBAM registry has already been granted to Indian verifiers this month, marking an initial step, but official recognition of the NABCB remains the primary goal.
The urgency stems from the upcoming compliance timeline. While the transition phase is underway, the mandatory filing of CBAM returns for Indian exporters is scheduled to begin in September 2027. Businesses that fail to provide accurate, verified emission data risk having the EU apply 'default values' to their products. These default values are often based on the worst-performing production facilities in the region, which can lead to significantly higher carbon levies and hurt the profit margins of Indian companies. Estimates suggest that carbon-intensive sectors could face margin pressure if they are unable to prove lower emissions compared to these default standards.
In contrast to the negotiations with the EU, India has already secured a significant breakthrough with the United Kingdom. The UK government has formally recognized the NABCB for its own carbon border measures, which take effect on January 1, 2027. Furthermore, the UK has agreed to acknowledge carbon payments made under India’s domestic Carbon Credit Trading Scheme (CCTS). This agreement effectively prevents double taxation, allowing Indian exporters to offset domestic carbon costs against UK levies. This successful model provides a template that India is now leveraging in its ongoing discussions with Brussels.
For investors and industry participants, the key monitorable is the pace at which Indian verification bodies receive official EU accreditation. Success in these negotiations could lower compliance costs and help protect the competitiveness of Indian exports in the European market. Conversely, delays in setting up a robust verification framework increase the risk that small and medium enterprises, in particular, may struggle to meet the strict reporting requirements of the EU, potentially leading to lost orders or market access issues.