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ARTICLE AD BOX
India has notified greenhouse gas emission intensity targets for 208 carbon-intensive industries, including petroleum refineries and textiles, expanding the Indian Carbon Market to 490 obligated entities and supporting emissions reduction through a carbon credit trading mechanism.
New Delhi: The government has widened the scope of the Indian carbon market by setting greenhouse gas emission intensity (GEI) targets for 208 more carbon-intensive industrial units. The move brings more industries under the country's carbon compliance framework.
A notification issued on 13 January brings petroleum refineries, petrochemicals, textiles and secondary aluminium under the compliance mechanism of the Carbon Credit Trading Scheme (CCTS), requiring them to meet emission targets or buy carbon credits to offset excess emissions.
With this latest inclusion, a total of 490 obligated entities across the country’s most emission-intensive sectors are now covered under the compliance framework of the Indian carbon market. Earlier in October 2025, the government had notified GEI targets for 282 obligated entities in aluminium, cement, chlor-alkali and pulp & paper sectors.
The Carbon Credit Trading Scheme, notified in 2023, provides an overarching framework for the functioning of the country's carbon Mmarket. The scheme aims to reduce or avoid greenhouse gas emissions across various sectors of the Indian economy by assigning a price to emissions through a market-based carbon credit trading mechanism.
The CCTS functions through two routes — the compliance mechanism and the offset mechanism. Under the compliance mechanism, designated emission-intensive industries, known as obligated entities, are required to achieve prescribed GEI reduction targets. Entities that exceed their targets are awarded Carbon Credit Certificates, which can be sold to entities that fall short of their mandated goals.
Sustained engagement
According to the government, the expansion of sectoral coverage reflects sustained engagement with industry, detailed technical assessments and coordinated efforts among institutions and stakeholders. As the compliance mechanism widens and matures, the Indian carbon market is expected to play a key role in balancing industrial growth with India’s long-term climate commitments and its net-zero emissions pathway.
The offset mechanism in the CCTS is a voluntary system for non-obligated entities (those not directly regulated by CCTS targets) to earn carbon credit certificates by developing projects that reduce, avoid, or remove greenhouse gas (GHG) emissions. It incentivizes projects in areas like renewables, energy efficiency, and afforestation, allowing businesses to generate revenue from verified emission reductions, contributing to India's net-zero goals, and promoting sustainable development.
India has set a net-zero target for 2070, aiming to balance greenhouse gas emissions with removals so that overall emissions are neutral.
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