The Hindu Editorial Analysis
17 October 2025
Ensure Safeguards for India’s Carbon Market
(Source – The Hindu, International Edition – Page No. – 8)
Topic : GS Paper III – Environment: Climate Change, Carbon Market, Environmental Governance, Sustainable Development
Context
As India launches its Carbon Credit Trading Scheme (CCTS), the editorial warns against replicating exploitative global carbon market models that have dispossessed local communities and marginalized farmers. The authors argue that while carbon markets can incentivize emission reductions and sustainable practices, they must be designed with equity, consent, and benefit-sharing at their core.
The key issue is how India can expand carbon trading without deepening social inequities or environmental injustice.
1. The Global Context: Carbon Markets and Climate Justice
a) Carbon Credits – The Concept
A carbon credit certifies a reduction or removal of greenhouse gases (GHG) measured in CO₂-equivalent units.
These credits can be generated via:
- Renewable energy projects (solar, wind)
- Nature-based solutions (reforestation, agroforestry, biochar)
- Cleaner industrial transitions (low-emission fuels, carbon capture)
They allow firms and nations to offset emissions by investing in carbon-reducing activities elsewhere — forming the basis of global carbon markets under frameworks like the Kyoto Protocol (Clean Development Mechanism) and the Paris Agreement (Article 6).
b) The Double-Edged Nature
Globally, carbon trading has created a multi-billion-dollar economy, yet it has also:
- Enabled greenwashing by corporations, and
- Caused land grabs and exclusion of indigenous and rural communities, especially in Africa and Southeast Asia.
This tension between environmental goals and social equity is now central to India’s emerging carbon market discourse.
2. India’s Carbon Market Vision and Risks
a) The Indian Approach
India’s Carbon Credit Trading Scheme (CCTS) aims to:
- Promote emission reduction across sectors (energy, agriculture, manufacturing);
- Set sector-specific emission intensity benchmarks; and
- Establish a national registry and trading platform.
However, India’s approach remains compliance-driven, focusing on technical and procedural norms rather than community participation.
b) Emerging Vulnerabilities
- Farmers and local communities risk being sidelined in project design and benefit distribution.
- Carbon projects could become “modern plantations”, replicating colonial land control patterns.
- Absence of clear benefit-sharing norms, consent frameworks, and transparency may allow elite capture.
Hence, as India builds its market, it must learn from the failures of the global South to ensure social safeguards.
3. The Kenyan Experience: A Cautionary Tale
a) The Northern Kenya Carbon Project
- Launched in 2012 by Northern Rangelands Trust (NRT), claiming to be community-led.
- Covered 1.9 million hectares, aimed to sequester 50 million tonnes of CO₂ over 30 years.
- Later faced legal and ethical scrutiny for violating consent and benefit-sharing norms.
b) Allegations and Lessons
- Local communities alleged lack of Free, Prior and Informed Consent (FPIC).
- Reports of land grabbing, restricted grazing rights, and exclusion of pastoralists surfaced.
- In 2023, Verra (carbon standards certifier) suspended issuance of credits.
➡️ Lesson: Carbon projects can entrench inequality if not grounded in community consent, fair distribution, and transparency.
4. Why India’s Carbon Market Needs Safeguards
a) Legal and Institutional Gaps
- The draft Indian framework lacks clear guidelines for:
- Benefit-sharing between developers and communities;
- FPIC (Free, Prior and Informed Consent);
- Transparent monitoring of carbon revenue use.
b) Vulnerable Sectors
- Afforestation and Forestry Projects:
- Risk displacing traditional users (tribal, pastoral).
- May lead to restricted access to forest commons and village grazing lands.
- Agricultural Carbon Projects:
- Can exclude smallholders from benefits.
- Marginalized farmers may be locked into exploitative contracts.
- Renewable Energy Carbon Credits:
- May centralize land and benefits in private hands without ensuring community ownership.
5. The Way Forward: Designing an Equitable Carbon Market
a) Core Principles
- Community Ownership and FPIC:
Every carbon project must have local participation and consent mechanisms. - Benefit-Sharing Framework:
Ensure that revenues from carbon credits are distributed equitably among project participants. - Institutional Safeguards:
- Independent oversight bodies to review compliance and resolve grievances.
- Transparent disclosure norms for developers.
b) Policy and Legal Reforms
- Introduce a national benefit-sharing law to formalize the rights of local and indigenous communities.
- Integrate carbon market regulation with environmental justice laws (Forest Rights Act, PESA).
- Strengthen monitoring and adaptive regulation through decentralized governance.
c) Avoid Over-Regulation
The authors caution against burdensome legal frameworks that could discourage participation. Instead, India needs a balanced, transparent, and community-centric architecture that enables growth without exploitation.
6. Conclusion
India’s carbon market can become a global model for equitable climate action — but only if it integrates social justice with economic efficiency.
Without safeguards, it risks repeating the colonial logic of resource extraction under a green label.
The focus must shift from carbon counting to community empowerment, ensuring that carbon revenues not only offset emissions but also uplift the vulnerable.
“A just carbon market is one where sustainability advances with the consent and benefit of those who protect the environment the most.”