Indian Industry Plus A Pratisrutiplus Suppliment
The Government of India has notified Greenhouse Gas Emission Intensity (GEI) targets for additional carbon-intensive sectors under the Carbon Credit Trading Scheme (CCTS). The notification, issued on 13.01.2026, brings Petroleum Refineries, Petrochemicals, Textiles and Secondary Aluminium under the compliance mechanism of the Indian Carbon Market (ICM).
A total of 208 obligated entities across these sectors will now be required to meet specified emission intensity reduction targets. With this expansion, the compliance mechanism of the ICM now covers 490 obligated entities across India’s most emission-intensive industries. The Government of India first notified GEI targets in October 2025 for the Aluminium, Cement, Chlor-Alkali, and Pulp & Paper sectors covering 282 obligated entities.
The CCTS notified by the Government of India in 2023 provides an overall framework for the functioning of the ICM. The objective of CCTS is to reduce or avoid greenhouse gas emissions from various sectors of Indian economy by pricing the emissions through a carbon credit certificate trading mechanism.
The CCTS operates through two mechanisms: the Compliance Mechanism and the Offset Mechanism. Under the Compliance Mechanism, emission-intensive industries designated as Obligated Entities are required to meet assigned Greenhouse Gas Emission Intensity (GEI) targets. Obligated Entities that outperform their targets are eligible to receive Carbon Credit Certificates which they can trade with obligated entities which are unable to meet their targets.
This progress reflects years of sustained engagement with industry, rigorous technical assessment, and coordinated efforts across institutions and stakeholders. As sectoral coverage deepens and the compliance mechanism matures, the ICM is poised to play a central role in aligning industrial growth with India’s long-term climate objectives and net-zero pathway.
