By- Aishwarya Jha (Practicing Advocate at Supreme Court of India, New Delhi) & Ravi Teja ( Public Policy Consultant at Ernst & Young, India)
Abstract
India’s commitment to attain net zero carbon emissions by 2070 places forests at the heart of its Climate Action Plan. While India recognizes common but differentiated responsibilities, equity, and indigenous peoples’ rights within the UNFCCC, implementation of the Carbon Credit Trading Scheme (CCTS) does not sufficiently recognize indigenous peoples’ community rights (the statutory rights of Scheduled Tribes as well as Traditional Forest Dwellers) as protected and recognized under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (FRA). This article analyzes some of the challenges in law and in institutions that will likely arise when the architecture of the international carbon market is superimposed onto forests in which the tenure, governance, and community entitlements remain largely unrecognized, inadequately recognized, or in conflict, worsened by recent exemptions to the Forest (Conservation) Amendment Act, 2023. It focuses on some of the unresolved issues regarding tenure, Gram Sabha consent, additionality, and benefit sharing that will be critical to determine whether forest-based carbon credits can be legally secure and environmentally credible. Using the Orissa Mining Corporation case, the community forest governance model in the case of Mendha-Lekha and the persistent conflict resulting from diversion of forest land for development vs. afforestation for carbon credit, this article asserts that the Indian carbon-credit market will not be legally sound and will lack social legitimacy unless it recognizes forest-dwelling communities as rights bearers and co-governors of forest carbon. It concludes by recommending that the CCTS should formally incorporate Gram Sabhas as project proponents or co-project proponents of forest carbon projects within the Community Forest Resource areas to align India’s carbon market with the governance framework established by the FRA, as opposed to establishing another parallel framework.
Keywords: Carbon Credit Trading Scheme, Forest Rights Act, 2006, Gram Sabha, Community Forest Right, Net-Zero, Climate Justice
Introduction
India’s transition towards net-zero emissions by 2070 will happen amidst processes of industrialization, urbanization and increased energy demand. This presents India with a key policy conundrum: how can India expand economic opportunities and development while steadily reducing emissions per unit of GDP growth? One significant component of this transition will be the enhancement of natural ecosystems capable of sequestering carbon dioxide from the atmosphere. This means that forests will likely play a significant role in India’s climate strategy. However, forests are not merely carbon sinks. They are also socio-economic production systems, cultural landscapes, and customary territories for millions of forest dwellers. According to the response given to a question by the Minister of State for Environment, Forest and Climate Change in the Lok Sabha in December 2023, about 300 million Indians are forest dependent, as per the India State of Forest Report 2019. Out of the estimated 6,50,000 villages in India as per the 2011 Census, nearly 1,70,000 are forest fringe villages, areas located in the vicinity of forest areas whose residents’ lives and livelihoods are bound up with forest access. Any climate policy that intends to enhance the economic value of forests must tackle a fundamental question: who has authority over the forest resources, who makes decisions regarding their use, and who enjoys the benefits generated from their ecological and economic value?
These questions assume particular significance with the development of carbon-credit mechanisms and forest-based carbon projects. As forests are increasingly recognised for their capacity to store and sequester carbon, they may also become sites of carbon accounting and the generation of tradable credits. Therefore, the future of India’s carbon-credit ecosystem depends not just on carbon accounting and market regulation but also on the actual implementation of community forest rights. Its legitimacy will also depend upon the extent to which the rights of forest-dependent communities are recognised and meaningfully embedded within such projects.
This concern echoes the very philosophy of the Tribal Panchsheel of Jawaharlal Nehru (1958), which set out key principles of governance in the tribal and forest regions. The central idea of Panchsheel was that the forest-dwelling communities need to be provided with the opportunity to evolve along the lines of their own genius, that their customary rights in land and forests need to be recognized, and governance should function through their own social institutions rather than any external intervention. In the context of climate change, a carbon market, which views forest dwellers as mere labour or beneficiaries, can fall into the trap of the same mistakes that Panchsheel sought to avoid. Just like state-building in post-independence India required respecting the customary forest rights, a credible carbon ecosystem in the 21st century requires embedding community autonomy, local ecological knowledge, and Gram Sabha governance into its very fabric.
This question must also be examined in the context of the broader tension between India’s developmental trajectory and its climate commitments. The strategy for a low-carbon economy of India in the long run involves a target to decouple economic development from emissions and foster a highly innovative and low emission industrial system. The strategy also includes low-carbon electricity, sustainable transportation, energy efficient buildings, carbon-dioxide capture, forest and vegetation enhancement, and finance mobilization. Simultaneously, the domestic policy discourse of India remains centred on the reduction of emissions without impacting economic development.
