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India’s Green Credit Programme

 GS Paper 3

 Syllabus: Conservation, Environmental Pollution and Degradation


Source: TP

 Context: Following the Union Budget 2023-24 announcement, the MoEFCC notified the draft ‘Green Credit Programme (GCP)’ implementation rules 2023.

About the Green Credit Programme (GCP):

  • Under this, individuals, industries, FPOs, ULBs, gram panchayats and private sectors, etc., will be able to earn “green credit” for undertaking environment-friendly actions.
  • The green credits will be tradable on a proposed domestic market platform.
  • It follows the principle of LiFE – Lifestyle for Environment – to encourage sustainable lifestyles by driving consumers/communities towards behavioural changes to incentivise environment-friendly practices.


The overall administration of the scheme: It will be under the Indian Council for Forestry Research and Education – an autonomous organisation/ governmental agency under the MoEFCC.


8 sectors/activities that can qualify for generating credits:

Tree plantation-based Green CreditTo promote activities for increasing green cover across the country through tree plantation and related activities
Water-based Green CreditTo promote water conservation, water harvesting and water use efficiency/savings, including treatment and reuse of wastewater
Sustainable agriculture-based Green CreditTo promote natural and regenerative agricultural practices and land restoration to improve productivity, soil health and nutritional value of food produced
Waste management-based Green CreditTo promote sustainable and improved practices for waste management, including collection, segregation and treatment
Air pollution reduction-based Green CreditTo promote measures for reducing air pollution and other pollution-abatement activities
Mangrove conservation and restoration-based Green CreditTo promote measures for the conservation and restoration of mangroves
Ecomark-based Green CreditTo encourage manufacturers to obtain an eco-mark label for their goods and services
Sustainable building and infrastructure-based Green CreditTo encourage the construction of buildings and other infrastructure using sustainable technologies and materials


Objectives of GCP:

  • To create a market-based (supply and demand) mechanism for incentivising voluntary environmental actions/ individual or community behaviour.
  • To encourage the private sector as well as other entities to meet their existing obligations, stemming from other legal frameworks.


GCP vs carbon markets: Unlike carbon markets, where only greenhouse gas (GHG) emissions were traded, the GCP accounts for a wide range of actions and nowhere in the world such a wide range of actions are considered.


Significance of the GCP:

  • It’s a first-of-its-kind instrument that seeks to value and reward multiple ecosystem services to allow green projects to achieve optimal returns beyond just carbon.
  • The scheme will allow project proponents to also access carbon markets additionally.


 Similar mechanisms elsewhere: In some countries (France, Germany and Sweden), social services generate credits – taking care of the elderly for a certain number of hours, for instance, gets one some credit that you can exchange in a salon.




  • The draft was a good statement of intent but its implementation would be extremely challenging.
    • This is due to the difficulty in establishing the equivalence between various actions.
    • For example, how much water one saved is equivalent to a tonne of CO2 prevented from emissions is difficult to establish.
  • Monitoring, reporting and verification challenges.
  • A strong risk of greenwashing – the appearance of doing a lot without actually achieving much beneficial impact.


Way ahead:

  • Capacity needs to be built to monitor these systems and prevent fraud.
  • It will save resources that could be diverted to more transformational pollution control and biodiversity protection efforts.


Insta Links:

Farming: Carbon credit market


Mains Links:

The Government of India has proposed draft rules for the Green Credit Programme. Discuss the implications of these draft rules and their potential impact on promoting green initiatives and sustainability in the country.