Government officials, industry representatives, and civil society members gathered in Bhopal to explore how carbon markets can benefit Madhya Pradesh.
The event, called “Strengthening the State of Madhya Pradesh to Leverage Benefits and Opportunities from Carbon Markets,” was organised by the Environmental Planning & Coordination Organisation (EPCO) under the state government’s Environment Department, in partnership with WRI India.
The meeting aimed to find ways to include carbon finance in the state’s climate and development plans. Speaking at the event, Manu Shrivastava, Additional Chief Secretary of the Department of New & Renewable Energy, said carbon trading is becoming economically practical in sectors like solar energy and waste management.
“With better technology, government support, financial help, and strong supply chains, more sectors in Madhya Pradesh will soon be able to participate in carbon markets,” Shrivastava said. He also emphasised the importance of capacity-building initiatives like this event to integrate carbon markets into state projects.
What are carbon markets?
Carbon markets allow companies and organisations to trade carbon credits. Each credit represents one metric ton of carbon dioxide or equivalent greenhouse gases. This system offers a cost-effective way to reduce emissions while securing climate finance.
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The event covered several topics, including:
- The current global framework for carbon markets under the Paris Agreement.
- India’s developing carbon market.
- Specific opportunities for Madhya Pradesh.
Experts discussed the Paris Agreement’s Article 6, which governs international carbon market mechanisms:
- Article 6.2: Bilateral and multilateral agreements for trading emissions reductions.
- Article 6.4: A global carbon market administered by the UN.
- Article 6.8: Non-market collaboration for emission reduction goals.
Global examples and India’s potential
Subrata Chakrabarty, Associate Program Director at WRI India, shared examples of successful carbon trading projects, such as:
- Ghana and Switzerland collaborating on climate-smart agriculture.
- Thailand and Switzerland using e-buses.
- Vanuatu and Switzerland working on solar-powered electrification.
Chakrabarty noted that about 40 per cent of global carbon pricing systems, such as carbon taxes and Emissions Trading Schemes (ETS), allow businesses to use carbon credits to lower costs.
Varun Agarwal, Program Manager, highlighted India’s growing carbon market, which could help the country reduce 1.3 billion tons of CO2 emissions by 2030 while cutting costs by 28 per cent. He stressed the importance of setting ambitious goals and avoiding an oversupply of carbon credits to ensure success.
During a technical session, experts explained how Madhya Pradesh’s rich natural and industrial resources make it well-suited to benefit from carbon markets. Sectors like energy, forestry, industry, and livestock hold significant potential.
Key challenges discussed included:
- Meeting global standards.
- Ensuring fair distribution of carbon revenue.
- Maintaining transparency in emissions reductions.
The event concluded with a call for Madhya Pradesh to take the lead in India’s carbon market efforts. By building technical expertise and institutional capacity, the state can position itself as a frontrunner in this emerging field.
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