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ARTICLE · 19 DECEMBER 2025

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India's Carbon Credit Market: From Compliance To Esg Advantage

S.S. Rana & Co.
S.S. Rana & Co.
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S.S. Rana & Co.

S.S. Rana & Co.

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In 2023, India accounted for over 7% of global CO₂ emissions, making it the world's third-largest emitter.

IndiaEnvironment

Introduction: A Climate and Business Turning Point

In 2023, India accounted forover 7% of global CO₂ emissions, making it the world'sthird-largest emitter1. The same year, record-breaking heatwaves pushed peak electricity demand above 250 GW, exposing the country's energy vulnerabilities.2Meanwhile, Indian exporters brace for the EU'sCarbon Border Adjustment Mechanism (CBAM), which from 2026 will impose tariffs on carbon-intensive imports like steel and cement.3

Against this backdrop, India'sCarbon Credit Trading Scheme (CCTS)is more than a climate policy; it is a survival strategy. Introduced under theEnergy Conservation (Amendment) Act, 2022, the CCTS will be fully operational by 2026, rewarding industries that cut emissions and creating a market for those that lag behind.4

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