India is taking significant steps to operationalize its commitment to the Paris Agreement by establishing a National Designated Authority (NDA) to oversee carbon trading mechanisms. This move signifies India's dedication to achieving its climate targets and fostering sustainable development through international cooperation.
The Ministry of Environment, Forest and Climate Change (MoEF&CC) recently announced the NDA, which is a mandatory requirement under the Paris Agreement. This authority will play a crucial role in evaluating, approving, and authorizing projects related to Article 6 of the Paris Agreement, which deals with carbon trading. Article 6 outlines how countries can voluntarily collaborate to achieve their climate goals by trading carbon credits through international carbon markets. The establishment of the NDA demonstrates India's commitment to a global framework for reducing greenhouse gas emissions.
The NDA is composed of representatives from 21 ministries and departments, with the Secretary of the Environment Ministry as its chairperson. This diverse representation ensures a comprehensive approach to carbon trading, aligning it with national sustainable development goals and priorities.
The key functions of the NDA include:
The NDA will act as India's nodal body to operationalize international carbon market mechanisms and cooperative approaches under the Paris Agreement. It will be responsible for ensuring environmental integrity and promoting sustainable development through carbon trading initiatives.
India is developing a robust framework for the Indian Carbon Market (ICM) with the goal of decarbonizing the Indian economy by pricing greenhouse gas (GHG) emissions through the trading of carbon credit certificates. The Carbon Credit Trading Scheme (CCTS) is expected to help India achieve its climate goals under the UNFCCC and the Paris Agreement. The CCTS defines two mechanisms: a compliance mechanism and an offset mechanism. Under the compliance mechanism, energy-intensive industries will have GHG emission intensity targets set by the government. Entities that reduce their emissions below the prescribed intensity will be eligible for carbon credit certificates. The offset mechanism allows non-obligated entities to register projects for GHG emission reduction, removal, or avoidance in exchange for carbon credit certificates.
India's commitment to reducing its emission intensity of GDP by 45% by 2030 from 2005 levels, achieving 50% electric power capacity from non-fossil fuel sources by 2030, and creating an additional carbon sink equivalent to 2.5-3 billion tonnes of carbon dioxide by 2030 through afforestation demonstrates its dedication to its Nationally Determined Contributions (NDCs). The establishment of the NDA and the development of the ICM are crucial steps in achieving these goals and contributing to global efforts to combat climate change.
