Need to revise international carbon finance standards

Source: The post need to revise international carbon finance standards has been created, based on the article “Common Practice Standards must have India outlook” published in “The Hindu” on 30th September is 2024

UPSC Syllabus Topic: GS Paper 3-Agriculture

Context: The article discusses the need to revise international carbon finance standards to include India’s small farmers in agroforestry projects. By changing the “common practice” definition, more farmers can benefit from carbon credits and boost their income sustainably.

What is the status of India’s agroforestry sector?

1. India’s agroforestry sector covers 28.4 million hectares, representing 8.65% of the country’s land area.
2. Agroforestry contributes 19.3% of India’s total carbon stocks, showing its environmental significance.
3. The sector has potential for expansion to 53 million hectares by 2050.
4. Research suggests it could create an additional carbon sink of over 2.5 billion tons of CO2 by 2030 with proper policies and support.

What are the benefits of carbon finance support for agroforestry?

1. Expands India’s agroforestry area from 28.4 million hectares to 53 million hectares by 2050, contributing to environmental sustainability.
2. Agroforestry can be integrated with carbon finance projects like Afforestation, Reforestation, and Revegetation (ARR) initiatives. If proper policies and financial support are in place, it could create an additional carbon sink.
3. Provides additional income for small and marginal Indian farmers through carbon credits.
4. Improves soil fertility, water retention, and prevents erosion, enhancing agricultural productivity.

What is ‘Common Practice’ in Carbon Finance?

1. “Common practice” assesses if a project goes beyond typical activities in a region to qualify for carbon credits.
2. Projects considered common do not earn credits, as they provide no additional environmental benefits.
3. Global standards, like Verra’s and Gold Standard, use this criterion, often reflecting large-scale agriculture in regions like Latin America and Africa.
4. In India, 86.1% of farmers are small and marginal with less than two hectares, practicing scattered agroforestry.
5. These fragmented practices may be seen as “common,” excluding Indian farmers from participating in carbon finance projects.

What Should be Done?

1. Redefine the “common practice” criteria to recognize India’s agroforestry activities, allowing small farmers to qualify for carbon credits.
2. Provide financial support and incentives to increase India’s carbon sink through Afforestation, Reforestation, and Revegetation (ARR) projects.
3. Use successful models like TERI’s 19 ARR projects, which have benefited over 56,600 farmers across seven states, as examples for scaling up carbon finance initiatives.
4. Encourage international platforms like Verra and Gold Standard to adopt India-centric approaches.

Question for practice:

Why is there a need to adopt India-centric approaches in international carbon finance standards?