India to start trading in carbon market by July
What's the story
India will start formal trading in its domestic carbon market within the next four months, Union Power Minister Manohar Lal Khattar has announced. The move is part of the country's strategy to cut emissions and establish an economic framework for climate action. The announcement was made at the Bharat Electricity Summit 2026 in New Delhi.
Market mechanism
Lal describes carbon market as an incentive-driven approach
The carbon market will serve as a platform for emission balancing, letting those with excess carbon credits sell them to those who need them to meet their targets. "Those who have carbon certificates will be able to sell them, while those who do not will buy them to meet their obligations," Lal said. He described this system as an incentive-driven approach toward achieving carbon neutrality.
Climate goals
Net-zero emissions target by 2070 under Paris Agreement
India has pledged to reach net-zero emissions by 2070 under the Paris Agreement. The country is ramping up its renewable energy capacity and strengthening domestic policy frameworks. Lal stressed that climate action is a collective responsibility, requiring technology-driven solutions and behavioral changes from individuals and industries alike.
Emission targets
Carbon market will help meet emission reduction obligations
The Indian government has set greenhouse gas emission intensity targets for 490 obligated entities from 2026. These entities will have to cut their carbon footprint, with the carbon market providing flexibility and economic incentives for compliance. The minister also highlighted the success of the Perform, Achieve and Trade (PAT) scheme that has helped cut CO2 emissions by around 110 million tons while improving energy efficiency across sectors.
Smart metering
Carbon market to foster entrepreneurship and innovation
India has set a target of installing 200 million smart meters, one of the largest such programs in the world. The minister said the carbon market would become a long-term national asset, fostering entrepreneurship as well as innovation in clean technologies. "This is not just a market, but a national asset that will strengthen our economy and environmental responsibility," he said.