The group also says CBAM disregards the principle of “common but differentiated responsibilities and respective capabilities” (CBDR-RC), which recognises that while climate action is a shared global responsibility, countries have different capabilities and economic situations. By imposing a blanket approach, they argue, CBAM neglects these variances and disproportionately affects nations still grappling with poverty and development challenges. They urge developed nations to uphold multilateralism and support cooperative approaches rather than unilateral trade restrictions.International organisations and legal frameworks have been cited to support these positions. The UNFCCC’s Article 3.5 discourages measures that constitute “arbitrary or unjustifiable discrimination or a disguised restriction on international trade.”Similarly, Principle 12 of the Rio Declaration advocates for environmental actions that do not impose unfair economic burdens on other countries, particularly developing ones. BASIC reiterated that unilateral trade restrictions like CBAM contradict these established principles and undermine the spirit of agreements like the Paris Agreement and the Kyoto Protocol, which aim to address climate change through cooperative and inclusive actions.For instance, India is one of the world’s largest exporters of steel, iron, and aluminium to the EU. According to a recent report by the Global Trade Research Initiative (GTRI), the implementation of the CBAM is expected to pose a significant challenge to India’s metal sector. In 2022, 27 percent of India’s exports of iron, steel, and aluminium products worth USD 8.2 billion went to the EU. Starting January 1, 2026, the EU will begin collecting carbon tax on each consignment of steel and aluminium, which will result in Indian firms paying an amount equivalent to 20-35 percent in tariffs.Aruna Sharma, former Secretary at India’s Ministry of Steel, said: “For developing countries like India, the resources to comply with CBAM are limited. The exporters will need to raise investments by themselves without the financial support that European companies receive from their governments. The burden of CBAM on developing nations violates the principle of CBDR, which was agreed upon in the Paris Agreement.””The assistance or handholding under CBAM will focus on the countries that are ahead in the game, those who can afford to invest. For India, the cost could be 7–15% higher for carbon-intensive products. This doesn’t even account for potential future expansion of CBAM to cover value chain emissions,” she added.Among other issues that caused the delay was the placement of the annual UAE dialogue on implementing the global stocktake outcomes. This could impact whether, in the future, the dialogue focuses mainly on finance, as favoured by many developing countries, or considers a broader set of global stocktake follow-up issues, as favoured by developed countries.
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