Why in news?
The Indian government finalised a 21‑member National Designated Authority (NDA) to oversee carbon markets in the country. Establishing the NDA is mandatory under Article 6 of the Paris Agreement.
What is the NDA?
The NDA is a statutory body set up by the Ministry of Environment. It serves as the nodal authority for regulating, approving and monitoring carbon‑market activities in India.
Composition
- Members: The committee has 21 members, chaired by the Environment Secretary. It includes representatives from the ministries of External Affairs, Steel, Renewable Energy, Power and the NITI Aayog.
- Multi‑sectoral design: Bringing together officials from various sectors ensures that carbon‑market policies align with both domestic priorities and international obligations.
Functions
- Project approval: Evaluate and authorise projects that generate emission‑reduction units (ERUs).
- Set criteria: Recommend activities eligible for trading under the carbon market, consistent with India’s sustainability goals.
- Monitoring: Review and revise eligible activities as national priorities and climate commitments evolve.
- Credit utilisation: Authorise the use of ERUs for meeting India’s Nationally Determined Contributions (NDCs).
- International role: Represent India in Article 6 negotiations and facilitate credit transfers with other countries.
Why is the NDA important?
- Supports NDCs: The NDA helps India achieve its pledge to reduce the emission intensity of its GDP by 45 percent by 2030 (compared to 2005 levels).
- Encourages investment: A clear regulatory framework attracts investment in renewable energy and low‑carbon projects.
- Aligns with global rules: It ensures India’s participation in international carbon‑market mechanisms under Article 6 of the Paris Agreement, which allows countries to trade emission reductions.
Conclusion: The creation of the NDA is a critical step toward building a functional carbon market in India. It supports national climate commitments and opens opportunities for low‑carbon investment and international cooperation.
