‘If the EU and UK put a carbon tax, we’ll retaliate': Piyush Goyal

On Tuesday, the Commerce and Industry Minister Piyush Goyal said that if the European Union (EU) and the UK impose a carbon tax, a retaliatory action will be taken.

“Trade talks are going well but if they (EU, UK) put a carbon tax, we’ll retaliate. I think it will be very silly, particularly to put a tax on friendly countries like India,” the Minister said during the Columbia India Energy Dialogue 2025 in New Delhi.

“I can see the decline of Europe if they put things like the Carbon Border Adjustment Mechanism (CBAM). It will give us opportunities; it will actually lead to inflation there, making things more expensive. So, I’m not that concerned. Some economy will have to go down for our economy to go up, he said. In fact, this “will open up a plethora of opportunities for us,” he added.

Piyush Goyal blames the EU for not supporting the fight against climate change

He also remarked that the developed world has neglected India and other developing countries in the fight against climate change, which has become a global challenge.

“If a large developed country decides not to contribute to this effort or this energy transition, while another group of developed countries decide everybody will be taxed at the same level for carbon emission, similar to the carbon tax regulations in Europe, you will not be able to find a solution to this problem,” Goyal said.

He shared that fragmentation is not in the understanding, nor in the partitions of friendships, but it is in the mindset.

“If we do not start recognising the importance of per capita emissions, which is really the benchmark, which will determine who is responsible for that mess up there, the fragmentation will hurt the world,” he added.

“It’s in the thinking. And that thinking is clearly going down the ground; India, for example, has only contributed to three, three and a half per cent of the carbon up there. Yet, if we are going to be asked to contribute at the same level as a European company, I think that is going to be patently unfair,” Goyal said.

He also mentioned that bilateral trade conversations with the US are going ‘fabulously well’. 

“We are among the first to actively engage with the US. We talked about the Free Trade Agreement (FTA) during the Trump administration as well as during the Biden administration but there were some problems due to which they were unwilling to accept the FTAs. But I think, it is a great opportunity for the US and India to come together. We have shared interests in terms of global good and I see the conversations going extremely well. We have a targeted mission to expand our bilateral trade to $500 billion dollars by 2030,” Goyal said.

He added that the US and India are complementary to each other and are a perfect fit, with very few products in terms of competition.

“There are so many innovations not available in India which we'll rather buy from the US instead of non-market economies. When we talk about self-reliance, it is in terms of critical products which may cause issues at times. Every country cannot produce everything. There has to be a competitive advantage that different countries will have. Covid-19 was a wake up call, which led to a greater recognition of the importance of self-reliance in the supply chain. All of us in the world, everybody is focusing on a certain degree of self-reliance, but simultaneously is also opening doors wider for global trade, exchange of technologies,” Goyal said.

Also read: Apple’s US shift brings $14-billion iPhone opportunity to Indian manufacturers in Q1 (startuppedia.in)