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Environment
Carbon leakage is a term that used to denote the movement of businesses from developed countries as they raise their climate ambition to non-developed countries as they follow less stringent environmental and climate policies.
Nov 19, 2022
5 min read
List of contents in this explainer about Carbon Leakage
S.No | Contents |
1. | What is carbon leakage? |
2. | Why businesses exit from developed economies? |
3. | Policies that facilitate movement of businesses to non-developed countries |
4. | The European Union statement |
5. | Carbon Border Adjustment Mechanism |
6. | Opposition of BASIC nations |
7. | Prelims questions |
8. | Mains question |
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Prelims Questions
1. Carbon leakage is the reason behind the European Union's suggestion of a
A. Technology Mechanism and the the Technology Executive Committee
B. Climate Technology Centre and Network (CTCN)
C. Carbon Border Adjustment Mechanism
D. Carbon Neutrality Regime
2. Consider the following statements
1. Carbon leakage is a term used to denote the movement of carbon-intensive businesses out of developing economies.
2. Carbon leakage occur due to developed nation's efforts to cut emissions.
Select the correct statement/s
A. 1 only
B. 2 only
C. Both 1 and 2
D. Neither 1 nor 2
Explanation
Carbon leakage is a term used to denote the movement of carbon-intensive businesses out of developed economies. They shift their production to economies with less stringent carbon rules.
Mains Question
1. What is carbon leakage? Discuss the relation between carbon leakage and carbon border tax.
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