Mentor’s Comment: UPSC mains have always focused on Climate Change (2017), and COP 26 (2021).

In the Climate Change Performance Index (CCPI) 2025, India ranks among the top 10 climate performers globally, underscoring its commitment to climate action. India has been recognized for its significant role in South-South climate cooperation, reflecting its leadership in fostering collaboration among developing nations to address climate change. 

Today’s editorial highlights how South-South cooperation can help achieve climate goals, promote sustainable development, and empower developing countries to meet their climate targets, drawing attention to India’s strategic opportunities and responsibilities in this area. This content would help in substantiation of answers in Mains GS Paper III (Environment and Biodiversity).

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Why in the News?

India’s potential role in fostering climate cooperation between developing nations through South-South cooperation in the context of the Paris Agreement is needed for the  global solutions to tackle climate change.

How does Article 6 of the Paris Agreement benefit India in achieving its climate goals?

• Carbon Markets: Under Article 6.2, countries can trade carbon credits to meet their emissions reduction targets. India can participate in these carbon markets, generating revenue by selling surplus carbon credits earned through emission reductions in sectors like renewable energy, energy efficiency, and afforestation.

• • • By engaging in carbon trading, India can attract foreign investments from companies in developed countries looking to offset their emissions. This can provide funding for clean energy projects, supporting India’s transition to a low-carbon economy.

• Cooperative Approaches: Article 6.4 establishes a global carbon market mechanism, similar to the Clean Development Mechanism (CDM) under the Kyoto Protocol, but with improvements. India could utilize this mechanism to undertake joint projects with other countries that help reduce emissions while fostering sustainable development.

• • Through cooperative approaches, India can access advanced technologies, practices, and expertise from other countries, enabling its industries to adopt cleaner technologies and improve energy efficiency, contributing to its climate and development goals.

• Non-Market Approaches:

• • Article 6.8 promotes non-market mechanisms, which focus on facilitating actions like capacity-building, finance, and knowledge sharing to address climate change. This can help India strengthen its national capabilities to implement climate policies and adapt to the impacts of climate change, particularly in vulnerable regions.
  • India, being highly vulnerable to the effects of climate change, can benefit from non-market approaches to enhance its adaptive capacities and resilience, addressing critical sectors like agriculture, water resources, and infrastructure.

• Flexibility in Meeting Targets:

• • The flexibility provided by Article 6 allows India to find the most cost-effective solutions for emission reductions, especially in sectors where technology deployment is expensive or challenging. It provides an opportunity to meet its Nationally Determined Contributions (NDCs) in a way that balances economic growth with environmental sustainability.

What are the potential challenges India faces in utilizing ITMOs and engaging in international climate finance?

• Monitoring, Reporting, and Verification (MRV) Systems: India’s current MRV systems for tracking emissions reductions may not meet the rigorous standards required for ITMOs, which are crucial for ensuring transparency and accountability in carbon markets.
  • Inadequate MRV mechanisms could hinder India’s ability to accurately quantify and report emission reductions, limiting its participation in carbon trading and climate finance.
• Accessing Climate Finance: Despite being a major developing country, India faces challenges in accessing sufficient and predictable climate finance from international sources, as the global financing mechanisms often favor smaller or more vulnerable nations.
  • Limited access to finance can slow down India’s ability to implement large-scale climate projects, especially in sectors like renewable energy, adaptation, and infrastructure development.
• Ensuring Environmental Integrity: While ITMOs enable carbon trading, there’s a risk of “low-quality” credits or “double counting” (where emissions reductions are claimed by multiple parties), which could undermine the credibility and environmental integrity of the system.
  • If India is not careful in ensuring robust methodologies for generating and trading ITMOs, it might face challenges in maintaining the credibility of its climate commitments, affecting its international reputation.
• Domestic Policy and Institutional Coordination: India’s domestic policies on climate change may not be fully aligned with the requirements of international climate finance mechanisms or ITMO systems. There is also a need for better coordination among various ministries and stakeholders to implement and track climate action effectively.
  • Misalignment between international climate goals and domestic policies could result in inefficiencies and missed opportunities to access ITMOs and climate finance.

What are the opportunities for India under South-South cooperation via Article 6.2?

• Carbon Trading with Fellow Developing Countries: India can collaborate with neighbouring countries like Sri Lanka, Bangladesh, and others in the South Asian region to work together to reduce emissions through renewable energy, afforestation, or energy efficiency programs.
  • India could sell any surplus carbon credits generated through its own emission reduction efforts to other developing countries that need help meeting their own NDCs (Nationally Determined Contributions). This allows India to both achieve its climate goals and potentially generate revenue.
• Technology and Knowledge Transfer: India has already made significant progress in solar energy and can offer valuable lessons and technologies to fellow developing countries.
  • India can also help other countries develop adaptation strategies for climate change impacts, such as water management techniques, disaster preparedness, and climate-resilient infrastructure.
  • In return, India could receive new technologies, methods, and knowledge to enhance its own climate resilience.
• Joint Ventures for Clean Energy Projects: India can partner with other developing countries to co-develop large-scale renewable energy projects, such as solar, wind, or hydropower. Joint initiatives could be supported by carbon markets, with emission reductions which could attract investments, expertise, and improve access to clean energy technologies.
  • By collaborating with other developing countries, India can contribute to the development of affordable, scalable solutions that are tailored to the specific needs of developing nations.
  • These solutions could be implemented locally, reducing emissions and improving energy access.
• Strengthening Capacity and Institutional Frameworks: South-South cooperation can help India and other developing countries to assist in establishing frameworks for monitoring, reporting, and verifying (MRV) emissions reductions, benefiting both India and its partner countries.
  • India can help south countries in refining its strategies and implementing the best practices that suit their own development contexts.
• Leveraging Climate Finance: India, by engaging in South-South cooperation, could also have access to international financial instruments that make climate action more affordable.
  • This would be particularly beneficial in sectors where India faces challenges in scaling up clean technologies, like electric vehicles, or in regions like rural areas that require adaptation interventions.

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