Introduction

• Role of Carbon Markets: A tool to mitigate climate change and offer economic benefits to farmers through sustainable agriculture.
• Carbon Pricing Mechanisms:
  • Compliance Markets: Regulated by governments/UN, requiring businesses exceeding emissions caps to buy credits or pay taxes.
  • Voluntary Markets: Unregulated trading platforms like Clean Development Mechanism, Verra, and Gold Standard.

How Carbon Markets Work

• Recent Developments:
  • COP29 approved a centralized carbon market under the UN (2024).
  • India announced compliance and voluntary carbon markets, with NABARD listing five projects in Verra.
• Key Principles:

1. Additionality: Ensures reductions occur only due to credits.
2. Permanence: Guarantees long-term benefits (e.g., avoiding reversion to traditional ploughing).

Challenges for India’s Agriculture Sector

• Current Status:
  • Over 50 projects targeting 1.6M hectares in India, generating 4.7M credits annually (equivalent to offsetting emissions from 11 billion miles driven).
  • None of these projects are yet registered; farmers haven’t received payments.
• Key Issues:
  • Lack of high-quality credits may erode buyer trust.
  • Projects must deliver promised environmental benefits to sustain farmer participation.

Carbon Farming Projects in India

Study Findings

• Socio-economic Inclusion:
  • Marginalised communities and women excluded (women = 4% participants).
  • Higher land ownership among non-marginalised castes (63%) compared to SC/ST farmers (13%).
• Adoption of Practices:
  • New practices such as zero tillage, intercropping, and tree planting satisfy additionality criteria.

Major Challenges

• 45% of farmers reported poor communication.
• 60% lacked training; 28% abandoned sustainable practices by the second year.
• 99% didn’t receive carbon credit payments.
• Yield penalties and limited knowledge deterred participation.

Performance of Projects

• Startups focusing solely on carbon credits (“Carbon Core”) performed better but were less inclusive of smallholders.

Solutions for a Thriving Carbon Market

1. Promote Inclusivity:
   • Offer higher credit prices for projects involving smallholders and marginalised communities.
2. Enhance Communication and Training:
   • Regular farmer engagement and skill development.
3. Guarantee Timely Payments:
   • Ensure prompt compensation for farmers.
4. Collaborations:
   • Partner with national/international research bodies to prevent yield penalties and maintain food security.

Future Prospects

Advancing Measurement Science

• Use of digital technologies like remote sensing, satellite imagery, and drones to monitor project activities.

Collaborative Efforts Needed

• Policymakers, researchers, and private entities must join forces to ensure inclusivity, transparency, and better project implementation.

Conclusion: Building a robust agricultural carbon market in India demands addressing existing challenges while fostering innovation, inclusivity, and timely rewards for farmers.