“Unlike China which built a large manufacturing economy and now is trying to make it green, India can build a large manufacturing economy which is greener than the one that China built over the last 20-30 years,” he said while replying to a question on the energy transition from fossil fuel to a cleaner future driven by two sectors cement and steel.
“So that’s an opportunity for India. It is also a risk for India. If India does not make the transition fast enough, we will find that large economic blocks like the US, Europe and China have already made the transition and India gets locked out of those markets because of carbon border adjustment mechanisms and other such constructs,” Narendran observed.
The carbon border adjustment mechanism (CBAM) is the European Union’s planned tax on carbon emissions caused due to manufacturing of goods imported to the EU from countries like China and India. It especially focuses on energy-intensive products like iron, steel, cement, fertiliser and aluminium.