Abstract

Carbon trading is a advance format, where firms or countries buy and sell carbon permits as part of a program to trim out carbon emission. It is a widespread method countries utilize in order to meet their obligations specified by international Kyoto Protocol (1997) of United Nations Framework Convention on Climate Change; namely the reduction of carbon emissions in order to mitigate future climate changes. It specifically targets carbon dioxide calculated in terms of CO2 equivalent or CO2. People buy and sell such products because it is the most cost-effective way to achieve an overall reduction in the level of emissions, assuming that transaction costs involved in market participation are kept at reasonable levels. Problems with forest carbon arise when trees are being grown solely for their carbon. If there are other economic uses of the reforested land, such as producing fuel wood, rubber, fruits, and food crops, then the cost of carbon sequestration is lower. Communities can use carbon payments to finance sustainable tree-growing investments that produce these non-carbon benefits. Carbon Development Mechanism(CDM) is  trading project which is administered by the CDM executive which reports and is accountable to the Conference of Parties(COP) Carbon Trading In India: Though India is potentially the largest market for carbon credits on the MCX, we still need to implement proper policies to allow trading of certified emission reductions (CERs), carbon credit. To increase the market for carbon trading Forward Contracts (Regulation) Amendment Bill has been introduced in the Parliament. Thus we see that Carbon Trading is definitely the “Greenest” pastures for business trading for the small and large scale private and governmental sectors in India with opportunities for everyone. So, in this paper we can review and put forward the ways and market standards that we can set so that the concept of carbon trading can have its roots in India too.

Key Words:Carbon credit, Carbon Trading, carbon permit, credit mechanism, Kyoto protocol and Carbon Trading in India