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India says no to 'green protectionism' of carbon tariff

Posted on 08 Apr 2009 | IANS

By Dipankar De Sarkar, Bonn, April 7 : India Tuesday strongly rejected any attempt by the US or Europe to impose tariffs on exports of Indian goods produced in energy-intensive sectors.

"Any effort to try and set down sectoral norms and then build a compensatory regime is simply not acceptable. That becomes protectionism under a green label," Shyam Saran, the prime minister's special envoy on climate change, said.

Saran's comments come amid reported attempts by both the European Union and the US to impose additional 'carbon tariffs' on exports of goods that are produced in the energy-intensive industries of steel, aluminium, cement and fertiliser.

The EU and US argue that exports in these sectors should be subject to additional tariffs because developing countries like India use more harmful greenhouse gases than their counterparts in rich countries in the production process.

In the US, the tax is proposed in a domestic climate change Bill.

But, talking to journalists at a United Nations conference on climate change in Bonn, Saran rejected the move saying it falls outside the area of climate change.

"We are rather surprised that these concepts of level playing field, and the need to maintain industrial competitiveness are being brought into the climate change discourse. These were never part of the climate change discourse," he said.

"Global action on climate change was never dependent on so-called industrial competitiveness or maintenance of trade competitiveness. As far as the energy-intensive sectors are concerned, we welcome any kind of arrangement where there can be a schedule of best practices for any of the energy-intensive industries.

"But if from that [you come] to the next step and say that there should be international laws which could be legally enforceable and that if you do not meet that international law there could be some kind of compensating mechanism through a carbon tariff or through some kind of a penalty which is imposed - then this is something which is not acceptable."

Saran also criticised reported EU moves to reform or phase out the Clean Development Mechanism (CDM), an international instrument by which rich countries can meet their carbon cutting requirements by helping set up green projects in developing countries.

Saran, a former foreign secretary who is leading the Indian delegation to the talks being held under the UN Framework Convention on Climate Change (UNFCCC), said India wanted to see an improvement in the way CDMs are administered to make them much more transparent and predictable.

"It suffers from those kinds of difficulties. Whether or not it may be possible to apply this on a sectoral basis, we will need to see.

"If this is to be linked to legally binding sectoral targets under the UNFCCC, then no - that is something which we will find completely unacceptable.

"But if there is some kind of a programmatic CDM which perhaps is applied on a wider basis, then that is something we would certainly be ready to look at."

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