The European Union has approved a new law that will ban imports of commodities linked to deforestation. The law, which goes into effect in 2024, could have a significant impact on India's exports to the EU.
According to a report by the Global Trade Research Initiative (GTRI), India's exports of coffee, leather, oil cake, paper, and wood furniture to the EU could be affected by the new law. The report estimates that the total value of these exports could be as much as $1.3 billion per year.
India's Exports to EU at Risk from Deforestation Law
The European Union's new deforestation law could hurt India's exports. The law bans imports of commodities linked to deforestation, and India exports about $1.3 billion worth of these commodities to the EU every year. The most significant products affected by the law are coffee, leather, oil cake, paper, and wood furniture.
India's response to the law has been mixed. Some officials have said that India will comply with the law, while others have said that India will challenge the law at the World Trade Organization (WTO).
The WTO is a global organization that sets rules for international trade. India could challenge the EU deforestation law at the WTO if it believes that the law violates WTO rules.
It is still too early to say what the impact of the EU deforestation law will be on India's exports. However, the law is likely to have a significant impact on India's economy.
- India's exports to the EU worth about $1.3 billion could be affected every year due to the EU's new deforestation law.
- The most significant products affected by the law are coffee, leather, oil cake, paper and wood furniture.
- The EU's unilateral move to ban deforestation-linked imports is “deceptive” and “discriminatory,” according to GTRI founder Ajay Srivastava.
- Srivastava also said that the EU's categorization of countries as high, standard or low risk is arbitrary and violates WTO rules.
- India is likely to challenge the law at the WTO.