India plans to launch a carbon trading market for major emitters in the energy, steel and cement industries as part of its efforts to accelerate the transition to cleaner fuels.
Prime Minister Narendra Modi is likely to announce the new trading platform at India's Independence Day celebrations on August 15th. Preparatory work has been going on since March, when consultations with ministries and companies began.
According to Indian media, the carbon market will initially be limited to sectors where it is difficult to reduce emissions, allowing participants to trade in credits received from their reduction. One of the goals is that state-owned energy companies such as Oil & Natural Gas Corp., Indian Oil Corp. and NTPC Ltd., as well as steel and cement companies, could benefit from planned investments in carbon capture projects.
India, the world's third-largest emitter, surprised experts by announcing a plan to achieve zero emissions by 2070 at the COP26 summit in Glasgow late last year. Although this is a decade less than that of neighboring Asian giant China, South Asia's economy is less developed and faces more severe climate challenges. The country aims to cut emissions by 1 billion tonnes by 2030 as a first step towards reaching its goal.
The proposed Indian market will be modeled after China, which introduced a mandatory carbon trading system for all major power plants last year.