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India, Japan finalise joint crediting mechanism
India and Japan launched their Joint Crediting Mechanism to trade carbon credits, boosting climate action, investment, and low-carbon tech collaboration.
India and Japan have formally adopted the rules of implementation for their Joint Crediting Mechanism (JCM), the ministry of environment, forest and climate change said on Tuesday, moving the bilateral climate partnership from framework to operation.
Under the JCM, a Japanese company may fund a project in India that cuts or removes greenhouse gas emissions; those reductions are independently verified and converted into carbon credits, which can then be transferred between the two countries and counted toward their respective climate pledges.
The rules were adopted on June 8 under Article 6.2 of the Paris Agreement — the provision that permits countries to trade emission reductions bilaterally to meet their Nationally Determined Contributions (NDCs), the individual climate targets each country has registered under the agreement.
India and Japan had signed a memorandum of cooperation (MoC) for the JCM in August last year, establishing a framework for collaboration on mitigation activities that deliver emission reductions or removals while supporting sustainable development in India.
According to an official release, the rule of implementation defines governance arrangements for the mechanism, including a joint committee with representatives from both governments, transparent project approval procedures, third-party validation and verification of emission reductions, sustainable development safeguards, and national registries to track the issuance and transfer of credits.
The mechanism will attract investment, bring low-carbon technologies to India, build technical capacity, and support emissions-cutting projects, the release said.
“The joint crediting mechanism demonstrates India’s firm commitment to climate action. It will catalyse investment, technology transfer and capacity-building for projects involving low-carbon technologies in India to support climate change mitigation and sustainable development,” the ministry said.
The Delhi Metro, product of India-Japan partnership, will be eligible for transfer of carbon credits under the joint crediting mechanism.
A separate analysis released on Tuesday by Zero Carbon Analytics (ZCA), an international think-tank on climate change and the energy transition, raised concerns about Asia’s growing reliance on liquefied natural gas (LNG), warning it could deepen fossil fuel dependence, expose economies to global price shocks, and drive emissions linked to worsening climate impacts across the region.
The analysis examined Japan’s role as one of the world’s largest LNG traders and found that US LNG resold by Japan to nine Asian countries — South Korea, China, India, Taiwan, Thailand, Singapore, Bangladesh, Pakistan and Malaysia — between 2020 and 2025 generated emissions equivalent to those of approximately 17 coal-fired power plants operating for a year.
Since 2021, Japan has sold more US LNG to other countries than it imported for domestic use; around 31% of US LNG it purchased and resold over that period was shipped to Asian markets.
An estimated 16.5 billion kg of US-produced LNG resold by Japan generated approximately 63.5 billion kg of CO2 emissions across the fuel’s full supply chain, ZCA said.
