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GTAP Resource #6021

"Border vis-à-vis Domestic Carbon Adjustment: Implications of Alternative System Boundary for India to Reduce Carbon Emissions"
by Banerjee, Suvajit

As a non-obligated signatory to the Kyoto Protocol, India is not entitled with any targeted emission reduction responsibility and therefore frequently blamed by the obligated developed countries from the Annex-B list for its imprudent measures on rampant and random emissions. This paper intends to analyze the impacts and implications of a possible threat from the ‘border carbon adjustment (BCA)’ as an environmental-barrier may be put on by India’s export-partners as against a softer arrangement with ‘domestic carbon adjustment (DCA)’ in India. Besides the spirit of WTO, this instrument of BCA violates the present system boundary on emission reduction responsibility criteria based on territorial production emissions practised by the United Nation Framework Convention on Climate Change (UNFCCC). This study compares the implications of BCA imposition on India’s exports under the present system boundary as against an alternative system boundary based on territorial consumption emissions. The study is methodologically based on a ‘computable general equilibrium (CGE)’ model, following the static approach of ‘Partnership in Economic Policy (Decaluwé et al., 2009)’, however significantly deviating with one respect, this study assumes India as a big importer and has some influence in the pricing decision of its imported items. Since BCA under presently practised system boundary is totally inconsistent, either a ‘consumption-based accounting’ is recommended, to be made fully operational or resistance should be built among the developing countries to oppose this BCA from its implementation.

Resource Details (Export Citation) GTAP Keywords
Category: 2020 Conference Paper
Status: Published
By/In: Presented during the 23rd Annual Conference on Global Economic Analysis (Virtual Conference)
Date: 2020
Created: Banerjee, S. (4/12/2020)
Updated: Banerjee, S. (5/15/2020)
Visits: 807
- Calibration and parameter estimation
- Trade and the environment
- Other data bases and data issues
- Asia (South-Central)

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