What are carbon credits?

 Investors happily bid adieu to another profitable financial year. Environmentalists too were a relieved lot as the concept of carbon credits was gaining ground. Find out more about carbon credits

Winters are no more pleasant for people living in Delhi and NCR. The entire region is engulfed in smoke emanating from fires dotting the region. Burning the stubble is far more convenient and cheaper for farmers instead of plucking the crop from the roots. Several steps to wean them away proved futile. But now, a novel initiative is showing some promise. Indian Agricultural Research Institute is teaming up with a private firm to build a marketplace for trading in carbon credits by Indian farmers.

While carbon credit trading in agriculture is a nascent field in India, it can provide an alternative source of earning to farmers. With this, the farmers would be able to claim carbon credits for a host of practices such as not burning paddy straw, not ploughing land, and laser levelling of land. But, what exactly are carbon credits? Let us find out. Let us first understand carbon market mechanisms. As the UNFCCC explains, when a country sets a limit, or cap, on its greenhouse gas emissions, it creates something of value. That something is the right to emit.