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India plans own uniform carbon trading market

  • Posted By
    10Pointer
  • Categories
    Economy
  • Published
    27th Apr, 2022

Context

India, the largest exporter of carbon credits, proposes to have its own uniform carbon market in one year as a large finance avenue for energy transition projects and emission reduction.

What is Carbon trading market?

  • Carbon trading is a market-based system aimed at reducing greenhouse gases that contribute to global warming, particularly carbon dioxide emitted by burning fossil fuels.
  • Carbon trade is the buying and selling of credits that permit a company or other entity to emit a certain amount of carbon dioxide.
  • The value of the carbon is based on the ability of the country to store it or to prevent it from being released into the atmosphere.

Carbon credits

  • Carbon credits are like points that are issued to someone for either avoiding carbon dioxide emission or absorbing some amount of CO2 back from the atmosphere.
  • One credit is awarded for a one-tonne reduction in CO2.

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