Q10 · UPPSC current affairs · 13 October 2026 · PIB · Carbon Credit Trading Scheme and EU CBAM

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In international trade discussions involving the European Union, what does the Carbon Border Adjustment Mechanism (CBAM) primarily entail?

A Mandatory technology transfer agreements for renewable energy equipment
B A global quota system restricting the export of crude oil from member states
C Financial subsidies provided by the EU to developing nations for planting trees
D An EU tariff mechanism on carbon-intensive goods imported into the EU based on embedded carbon emissions

Correct answer: (d) An EU tariff mechanism on carbon-intensive goods imported into the EU based on embedded carbon emissions

Explanation

CBAM is an EU tariff mechanism applied to carbon-intensive goods imported into the EU, calculated on the basis of their embedded carbon emissions. Options A, C, and D misrepresent the tariff-based nature of the mechanism.

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