New Delhi, Aug. 21 -- The recently-announced US-EU (European Union) Framework Agreement on trade-which maintains a 15% blanket tariff on the bloc's exports to the world's largest economy-could offer important lessons for India as it negotiates its own rules under the EU's Carbon Border Adjustment Mechanism (CBAM).

As New Delhi pursues a free trade agreement (FTA) with the EU, experts say the country must secure similar carve-outs and flexibilities, particularly to protect Indian small and medium enterprises (SMEs) and exporters from steep compliance costs.

Without such measures, the country's firms could face significant regulatory hurdles, while US competitors benefit from preferential treatment, potentially eroding India's competitive...