First Compliance-Based Domestic Carbon Market

In April 2025, the Ministry of Environment, Forest and Climate Change (MoEFCC) released a draft notification for India's first domestic carbon market, aimed at decarbonising high-emission industries and advancing the country's climate targets.

Key Points

Carbon Credit Trading Scheme (CCTS): The draft outlines India's compliance-based domestic carbon market, focusing on sectors like aluminium, cement, chlor-alkali, and pulp and paper
Emission Reduction Targets: The draft sets Greenhouse Gas Emission Intensity (GEI) targets for 2025, with specific reduction goals for the years 2025-26 and 2026-27.
Sectoral Coverage: Over 290 entities from high-emission industries, including Vedanta, Hindalco, UltraTech, and Dalmia, are included in the scheme.
Benchmarking and Verification: A uniform formula for emission calculation and verification is proposed, with sector-specific benchmarks for integrated and standalone units
Industry Support: Industry leaders have welcomed the initiative, citing it as a significant step towards establishing a formal carbon market in India.