VOI World/ Desk
The United Kingdom has recognised India’s Carbon Credit Trading Scheme (CCTS) as a qualifying carbon pricing mechanism under its Carbon Border Adjustment Mechanism (CBAM), a move expected to reduce the carbon-related burden on eligible Indian exports.
The recognition means UK importers of eligible Indian goods can seek relief for the effective carbon price already borne under India’s CCTS, subject to the evidence and verification requirements under UK law. The key objective is to avoid double carbon pricing on goods that have already faced an eligible carbon cost in their country of origin.
India’s CCTS is included in the UK government’s indicative list of overseas carbon pricing schemes assessed as meeting the qualifying criteria for carbon price relief. The list, published by the UK government in August, also includes carbon pricing mechanisms from countries such as Australia, China, Japan, South Korea and South Africa.
The development is particularly significant for Indian exporters as the UK prepares to introduce its CBAM from January 1, 2027. The mechanism will apply to carbon-intensive imports in sectors including iron and steel, aluminium, fertiliser, hydrogen and cement.
The move also strengthens India-UK trade cooperation following the operationalisation of the India-UK Comprehensive Economic and Trade Agreement in July 2026. Officials from both sides are expected to continue discussions on carbon pricing and the interaction between India’s CCTS and the UK’s CBAM framework.
