Starting January 1, the European Union's Carbon Border Adjustment Mechanism (CBAM) tax on metals like steel and aluminum will take effect. Indian exporters may need to reduce prices by 15-22% to cover the costs imposed by EU importers, who are responsible for purchasing CBAM certificates based on embedded emissions. Accurate emissions accounting and verification will be critical for Indian companies to maintain market access to the EU, especially as the mechanism shifts from reporting to payment in 2026.