New Delhi, July 26 -- The UK has agreed not to impose the carbon border tax on India even though the two countries' brand-new trade pact makes no mention of the contentious levy, two Indian government officials aware of the matter said.

The Carbon Border Adjustment Mechanism (CBAM) was not discussed as part of the trade talks since the UK is yet to roll out the policy, the people cited above said on the condition of anonymity. Instead, the matter was taken up separately through a parallel track with UK counterparts.

"They have agreed, in principle, not to implement CBAM on Indian goods. This understanding exists outside the FTA, but it reflects mutual recognition of each other's concerns," one of the two officials said.

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