Despite protests, EU to implement deforestation regulation from Dec 30

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The EU has said that it will go ahead with the implementation of its controversial EU deforestation regulation (EUDR) from December 30 this year as planned despite strong protests from countries including India, Brazil, Indonesia and the US at the WTO, a Geneva-based trade official has said.

“Members are concerned as the regulation is set to hit exports of farm products such as palm oil, cattle, soy, cocoa, coffee, rubber, and timber and a range of derived items to the bloc,” the official told businessline.

The EUDR requires exporters of the identified items to prove that the products do not originate from recently deforested land (post December 31, 2020), forest degradation, or breaches local environmental and social laws. It is aimed at reducing the EU’s impact on global deforestation and forest degradation. 

“The EU has not yet shared its assessment methodology and there is much confusion on how it will bench-mark countries into high risk, standard and low risk categories. It is just not possible for Indian farmers and industry to be ready to provide the required land records and traceability evidence at such short notice. The government will continue to oppose it at the WTO and also bilaterally including in the negotiations for the India-EU free trade pact,” a Delhi-based source tracking the matter said.

Exports may be hit

India’s exports of the identified items to the EU worth an annual $1.3 billion could be affected once the EUDR is in place, per calculations made by research body Global Trade and Research Initiative (GTRI). The amount could be even larger taking into account all the derived products that are to be included such as meat products, chocolate, pulp, furniture, palm nuts, glycerol, rubber tyre, industrial acids, leather, raw & tanned hides and paper.

While compared to India’s total exports worth about $75 billion to the bloc in 2023-24, the value of the affected items is small, but the EUDR could also act as a barrier to India’s ambitions of gaining a larger chunk of the EU market, especially after signing the proposed India-EU FTA, the source said.

“The EU said it was focusing on ensuring that all the elements necessary for the implementation of the regulation are ready on time, including the guidance for economic operators and member states, as well as the IT systems,” the Geneva-based official said.

The opposing countries pointed out that there was yet no clarity on transparency and fairness of the assessment process and how the EU planned to assist small producers and exporters in meeting the new requirements. 

Indonesia proposed at the meeting that third-party authorities from affected exporting countries should also be involved to ensure accountability and fairness in the implementation of the EUDR.