CURRENT AFFAIRS | MARCH 2026
CLAT Relevance
• India — 2nd largest steel producer globally
• EU CBAM — Carbon Border Adjustment Mechanism (January 2026)
• Green Steel concept — hydrogen-based steelmaking
• 7-9% of global CO2 emissions from steel sector
• India — 2nd largest steel producer globally
• EU CBAM — Carbon Border Adjustment Mechanism (January 2026)
• Green Steel concept — hydrogen-based steelmaking
• 7-9% of global CO2 emissions from steel sector
India’s Steel Sector — Overview
- India = 2nd largest crude steel producer after China
- Production: ~140 MT (2024-25); Target: 300 MT by 2030
- Steel sector contributes ~2% to India’s GDP
- Employs 25+ lakh people directly and indirectly
- Steel accounts for 10-12% of India’s total CO2 emissions
The Carbon Problem in Steelmaking
Key Fact
Global steel industry produces ~3.6 billion tonnes of CO2/year, making it one of the hardest-to-abate sectors. India’s BF-BOF route emits 2.5-3.0 tonnes of CO2 per tonne of steel.
Global steel industry produces ~3.6 billion tonnes of CO2/year, making it one of the hardest-to-abate sectors. India’s BF-BOF route emits 2.5-3.0 tonnes of CO2 per tonne of steel.
- BF-BOF route (Blast Furnace – Basic Oxygen Furnace) — India’s dominant process; uses coking coal
- EAF route (Electric Arc Furnace) — uses scrap/DRI; lower emissions
- Challenge: India’s growing steel demand conflicts with Net Zero 2070 commitment
What is Green Steel?
- Steel produced using green hydrogen instead of coking coal as reductant
- Hydrogen-based DRI (Direct Reduced Iron) = key technology
- Also includes: EAF with renewable electricity, carbon capture (CCUS)
- Currently costs 20-30% more than conventional steel — “green premium”
EU CBAM — Impact on India
CLAT Angle — International Trade
CBAM (Carbon Border Adjustment Mechanism) = EU’s carbon tax on imports. It penalises high-carbon products entering the EU. India exports ~6 MT steel to EU annually — CBAM could add USD 50-100/tonne in carbon costs.
CBAM (Carbon Border Adjustment Mechanism) = EU’s carbon tax on imports. It penalises high-carbon products entering the EU. India exports ~6 MT steel to EU annually — CBAM could add USD 50-100/tonne in carbon costs.
- CBAM covers: steel, iron, cement, aluminium, fertilisers, electricity, hydrogen
- Transitional phase: reporting began 2023; full implementation January 2026
- Mechanism: importers must buy CBAM certificates = EU carbon price (~EUR 50-70/tonne)
- Carbon leakage = industries relocating to countries with weaker emission norms (CBAM aims to prevent this)
Impact on Indian Exporters
- Rs 30,000-50,000 crore annual impact on Indian exports to EU (various estimates)
- Most affected: steel, aluminium, cement exporters
- India has called CBAM “discriminatory” and against WTO principles
- India’s response: developing domestic carbon market and Green Steel Taxonomy
India’s Green Steel Response
- National Green Hydrogen Mission — Rs 19,744 crore for green hydrogen ecosystem
- Green Steel Taxonomy (Dec 2024) — India first to define standards
- Tata Steel — hydrogen-based steelmaking pilot at Jamshedpur
- SAIL, JSW, JSPL — announced decarbonisation roadmaps
Key Terms for CLAT
- CBAM — Carbon Border Adjustment Mechanism
- Carbon leakage — Industries relocating to avoid carbon costs
- BF-BOF — Blast Furnace – Basic Oxygen Furnace
- Green Hydrogen — Hydrogen produced from renewable energy
- DRI — Direct Reduced Iron
Source: UPSC Essentials, The Indian Express — March 2026
Practice Quiz
Test your understanding with these 10 MCQs:
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Quick answers
India is the worlds _____ largest steel producer:
2nd largest. India is the worlds 2nd largest crude steel producer after China.
EU CBAM came into effect from:
January 2026. EU Carbon Border Adjustment Mechanism (CBAM) transitional phase reporting began, with full implementation from January 2026.
CBAM stands for:
Carbon Border Adjustment Mechanism. CBAM = Carbon Border Adjustment Mechanism, an EU policy to prevent carbon leakage.
Steel industry accounts for approximately what percentage of global CO2 emissions?
7-9%. The steel industry accounts for approximately 7-9% of global CO2 emissions (some estimates say up to 10-12% including indirect).
Green steel uses which alternative to coal-based reduction?
Hydrogen-based direct reduction. Green steel primarily uses hydrogen-based Direct Reduced Iron (DRI) instead of coal-based blast furnace process.
Which of these is Indias major steelmaking process?
Blast Furnace – Basic Oxygen Furnace. India primarily uses the BF-BOF (Blast Furnace – Basic Oxygen Furnace) route for steelmaking.
