Key Highlights from COP30 Climate Conference
World leaders convened at the United Nations Climate Change Conference (COP30) in Belem, Brazil, to discuss climate change and its intersection with trade, particularly focusing on the demands from developing nations, including India.
Developing Countries' Demands
- Focus on Climate Impact on Trade: Developing countries are pushing for more prominent discussions on the impact of climate on trade in future climate meetings.
- Proposed Annual Dialogues: Suggestions include annual discussions on climate change-related trade restrictions, cross-border impacts of climate policies, and roundtables on trade and climate change in 2026 and 2027, with outputs contributing to the Global Stocktake in 2028.
Trade and Climate Policy Challenges
- Divisions in Climate Policy: Differences over climate policy and trade pose threats to collective action required to limit global temperature rise to 1.5 degrees Celsius.
- India's Position: India, represented by Environment Minister Bhupendra Yadav, is expected to make a national statement addressing these issues, highlighting challenges in finance for adaptation and emission reductions.
Forum for Climate and Trade Cooperation
- Launch by COP30 President: COP30 President Andrei Lago announced the establishment of a forum for dialogue and solution-building at the intersection of trade and climate change.
- Brazil's Role: This forum aims to bridge tensions between developed and developing nations over a three-year process, with some consultations likely to be held in Geneva at the World Trade Organization.
Impact of European Union Policies
- Carbon Border Adjustment Mechanism (CBAM): The EU's CBAM, effective from January 2026, will levy charges on importers buying products from countries with higher carbon emissions compared to EU standards.
- Impact on Indian Exporters: Indian exporters of iron and steel to the EU could face approximately €301 million (around ₹3,000 crore) in CBAM fees, the highest among similar exporting countries, as reported by Sandberg.
The Forum for Climate and Trade Cooperation is seen as a critical platform for developing countries to influence the convergence of trade policy and climate ambition towards a more sustainable and equitable global economy.
