UPSC Prelims Practice Questions — India to support steel exports hit by Europe’s carbon tax

Question 1

The European Union's Carbon Border Adjustment Mechanism (CBAM), whose definitive phase impacts Indian steel exports from 2026, was established under which one of the following legal instruments?

Accepted Answer

Regulation (EU) 2023/956 of the European Parliament and of the Council

Answer

Regulation (EU) 2018/842 of the European Parliament and of the Council

Answer

Directive 2003/87/EC of the European Parliament and of the Council

Answer

Regulation (EU) 2021/1119 of the European Parliament and of the Council

Question 2

With reference to the European Union's Carbon Border Adjustment Mechanism (CBAM) as it enters its definitive phase on 1 January 2026, consider the following sectors:
1. Cement
2. Hydrogen
3. Glass and ceramics
4. Fertilisers
Which of the above are correctly identified as sectors covered by CBAM in its initial scope?

Accepted Answer

1, 2 and 4 only

Answer

1 and 4 only

Answer

2 and 3 only

Answer

1, 2, 3 and 4

Question 3

Among the sectors covered by the EU's Carbon Border Adjustment Mechanism (CBAM), which one accounts for the single largest share of India's CBAM-exposed exports to the European Union, prompting the Government of India in February 2026 to announce dedicated sectoral support measures?

Accepted Answer

Iron and Steel

Answer

Cement

Answer

Aluminium

Answer

Fertilisers

Question 4

In the Government of India, the nodal ministry that issued the February 2026 assurance of support to exporters affected by the EU's Carbon Border Adjustment Mechanism, and which oversees India's response on steel-sector carbon trade barriers, is the:

Accepted Answer

Ministry of Steel

Answer

Ministry of Commerce and Industry

Answer

Ministry of Environment, Forest and Climate Change

Answer

Ministry of External Affairs

Question 5

As CBAM entered its definitive phase on 1 January 2026, how many carbon-intensive sectors are covered under the initial scope of the EU's Carbon Border Adjustment Mechanism?

Accepted Answer

Six

Answer

Four

Answer

Five

Answer

Eight

UPSC Prelims Practice Questions — India to support steel exports hit by Europe’s carbon tax

Q1. The European Union's Carbon Border Adjustment Mechanism (CBAM), whose definitive phase impacts Indian steel exports from 2026, was established under which one of the following legal instruments?

Q3. Among the sectors covered by the EU's Carbon Border Adjustment Mechanism (CBAM), which one accounts for the single largest share of India's CBAM-exposed exports to the European Union, prompting the Government of India in February 2026 to announce dedicated sectoral support measures?

Q4. In the Government of India, the nodal ministry that issued the February 2026 assurance of support to exporters affected by the EU's Carbon Border Adjustment Mechanism, and which oversees India's response on steel-sector carbon trade barriers, is the:

Q5. As CBAM entered its definitive phase on 1 January 2026, how many carbon-intensive sectors are covered under the initial scope of the EU's Carbon Border Adjustment Mechanism?