Carbon Reporting Has Reached the Indian Factory Floor

Indian manufacturers have new rules at home and a new charge at the EU border. Both need better emissions data from the plant itself.

Earlier this month, EY’s US arm teamed up with Watershed, a company that makes sustainability software. The two will help businesses measure their emissions, work out the carbon footprint of individual products and prepare data that auditors can check. The deal is American, but Indian manufacturers face the same problem, and it is getting harder to ignore.

Three things are behind this.

1. SEBI. Its sustainability reporting rules apply to India’s 1,000 largest listed companies. A core set of figures in these reports must be checked by an outside party. That applies to the top 500 companies from FY2025-26 and to all 1,000 from FY2026-27. Reporting on suppliers and customers is optional for now.
2. Indian carbon market. In October 2025, the government set emission targets for aluminium, cement, chlor-alkali, and pulp and paper plants. In January 2026, it added oil refineries, petrochemicals, textiles and secondary aluminium. That brought 490 plants under the scheme. Each plant is measured against its emissions in FY2023-24. Those that do better than their target earn carbon credits they can sell, and those that fall short have to buy credits. Steel targets are still at the draft stage: the environment ministry reissued a draft in June 2026 covering 255 units. Targets for fertilisers were also still pending as of March.
3. Europe. Since 1 January 2026, EU importers of goods such as steel and aluminium have been liable for the carbon emitted in making them. The first annual declaration and certificate surrender for this year’s imports is due on 30 September 2027. A January 2026 study by a New Delhi think tank, found that 8.3 % of  Indian exports fell in this largely entirely metals for EU and Steel, Aluminium, cement and fertiliser comprising goods of these kinds going into the US market .

What does this mean for someone running a plant? All three demands depend on, to begin with , reliable figures for the energy, fuel and process emissions each site produces. 

Indian firms have started offering help, including for smaller companies. In August 2025, the Services Export Promotion Council, set up by the Commerce Ministry, launched a “Carbon Cell” .It helps exporters, especially small iron and steel firms, calculate their emissions and prepare EU border reports. Some new AI based platforms also offer a carbon management platform and are already helping large automobile players with it . The Institute of Chartered Accountants of India has also built a carbon emission calculator for small businesses, which it says supports SEBI-style sustainability reporting.

That puts meters, energy management systems and production data at the centre of the job. These tools used to matter mainly for efficiency. Now their numbers feed into stock-market filings, carbon credits and export prices.

How much any one company is affected depends on its sector, whether it is listed and where it sells. Big steel, aluminium, chemical  exporters fall under all three at once. They are the ones with the strongest reason to get their emissions data right first.