Himachal Pradesh/Mumbai: Prime Minister Narendra Modi is pushing the world to adopt a vaguely worded environmental programme that he first proposed as chief minister of Gujarat 15 years ago but has been conceptually opposed three times by one of his own ministries and by a Supreme Court committee.

The idea: that, as part of India’s climate-change commitments, private plantations run by companies could replace swathes of India’s forests, currently governed by either local communities or the government and over which communities that depend on these forests have legal rights.

On 9 September 2023, while speaking at the G20 Summit session, Modi proposed that countries of the group start working on a “Green Credit Initiative”, a plan to create a competitive market system that would reward “environment-positive” actions in the form of “green credits”. 

Thirteen days earlier, on 27 August while addressing the Business 20 India 2023 summit in New Delhi,  Modi announced that India has prepared “a framework for green credits businesses”, even as “everyone has been caught up in carbon credits, and some are even benefiting from them”. 

Countries and businesses use permits called carbon credits to offset their carbon emissions by reducing carbon in other places through tree plantations or using renewable energy. Companies can trade carbon credits on exchanges, allowing them to emit a certain quantity of greenhouse gases, which contribute to warming the planet.

Like carbon credits, green credits could be bought or sold on a domestic trading platform, which does not yet exist; they cover a wider range of eight sectors, including tree plantation, water conservation, mangrove restoration and sustainable agriculture. 

A green credit would be given by the ministry of environment based on the nature and scope of an “environment-positive” action. But the draft rules do not clarify how such an action in one sector is meant to cancel out actions that are harmful to the environment, as carbon credits claim to do. 

With the notification of the draft green credit programme on 26 June 2023, India will adopt two credit mechanisms, carbon and green. The Carbon Credit Trading Scheme was notified on 28 June, two days after the notification of the Draft Green Credit Programme Implementation Rules.

Carbon credits have a certification system to prove reduction in carbon emissions, though these have often (here and here) been accused of being vulnerable to fraud and leading to exploitation of indigenous rights and ecosystems. 

With green credits, however, the meaning or value of a credit itself is not yet clear, but it is conceivable, said Soumitra Ghosh, an activist with an advocacy group called the All India Forum of Forest Movements, that companies may make misleading claims in the absence of technology or methods to verify such credits.

“You can do any activity and can claim it green and earn a credit for it,” said Ghosh. In 2023, Ghosh and a group of independent lawyers, researchers and others submitted a critique of the green credit programme to the union environment ministry, recommending “immediate withdrawal of the scheme”. 

“Green credit focuses on planet-positive actions,” said Modi during the G20 summit, urging businesses to “associate with green credits and make it a global movement”. The programme literature itself claims no direct climate benefits. 

“It is clear that this programme is for the domestic market, but it does not claim that the programme is a climate-mitigation programme to reduce emissions,” said Souparno Lahiri, senior climate and biodiversity advisor at the Global Forest Coalition, an advocacy. “I am not sure why this programme is developed if it is not aimed at climate benefits in the first place. What is it for?”

India’s policy changes around forest laws and policies are associated with climate mitigation, after India updated its Nationally Determined Contributions commitments to the United Nations Framework on Climate Change  in 2021 and goals in 2022. 

No country has a green credit programme like India’s. An exception, China, has an unrelated policy of such credits for banks that ensure responsible environmental risk management systems when they issue loans.

A Long, Troubled History

Countries that signed the Paris Agreement in 2016, a legally binding  international treaty on climate change, have committed to climate action plans that aim to cut carbon emissions through their nationally determined contributions. 

One of India’s updated commitments is to absorb 2.5 to 3 billion more tons of carbon dioxide from the atmosphere than it currently does by planting more trees and forests by 2030. 

The question then is, how India plans to achieve this target, given that industries and the state continue to push for deforestation? 

One way the Indian government has been doing this  is through government schemes for afforestation, such as the Compensatory Afforestation Fund, managed by forest departments and run on funds received from user agencies to compensate for loss of forests,  including mass afforestation schemes run by states. 

The union government is also pushing for afforestation by private parties, an approach with a long, troubled history that is closely intertwined with the green credit programme. From forest rights activists (here and here), to a Supreme Court committee and the tribal affairs ministry, there has been consistent opposition to the concept of private afforestation. 

The green credit programme is a part of a move (here, here and here) to restructure the entire architecture of forestry and forest rights in India by diluting  laws that protect forests from being cut down and introducing policies that encourage private players to manage tree plantations.

Article 14 sought comments from union environment minister Bhupender Yadav, minister of state Ashwini Kumar Choubey, environment ministry secretary Leena Nandan, and environment ministry joint secretary Nameeta Prasad over email, phone calls and messages to their offices.

An official at the ministry of consumer affairs, where Choubey has additional charge, said that his official Parliament email and his environment ministry email were both inactive. We also sent an email to Choubey's personal email. Prasad was in a meeting when we contacted him on 27 September. 

On the same day, Article 14 sent a follow-up email to Choubey’s consumer affairs ministry email account, as well as a WhatsApp message to the manager of his media cell. There was no reply, nor to another email sent to secretary Leena Nandan. Officials did not reply to at least three attempts to call Yadav at his office on 27 September. 

The programme comes in the context of implementing mission LiFE or Lifestyle for Environment, a concept Modi unveiled in 2021 to promote a mass movement of people and entities to lead environmental conscious lifestyles in response to climate change.  

“What the green credit programme does materially is not about whether it improves ecological outcomes on the ground,” said Vijay Kolinjivadi, a postdoctoral fellow at the Institute of Development Policy at the University of Antwerp. “It is markets and financialisation that are driving the green credit programme, not ecological devastation and ecological breakdown on a scale unseen in human history.” 

The Green Credit Programme unfurls along two timelines. One is the recent path that it has taken after its announcement in the budget speech in February 2023. The other originates in 2008 in Gujarat, during Modi’s tenure as chief minister.

Consultation Time Is Cut

The ministry of environment, forests and climate notified the Draft Green Credit Programme Implementation Rules on 26 June 2023, with a standard 60-day consultation period for receiving comments and responses from the public. 

The consultation period was scheduled to end on 24 August. On 18 July, the ministry issued another notification cutting short the deadline for public consultations to 31 July, “in order to give effect to the final notification for promotion of voluntary environmental actions”. This left only 14 more days for  public responses. 

In the 18 July notification, the ministry said that the draft notification had been released “for the information of the public likely to be affected” and “to receive objections and suggestions from any person”. The ministry also said “several consultations had already been undertaken with the concerned stakeholders” and between ministries before they issued the rules. 

Two days later, on 20 July, the Indian Council for Forestry Research and Education (ICFRE), an autonomous council under the ministry of environment, named as the administrator of the green credit programme, published a vacancy advertisement for “senior consultants” to draft guidelines, methodologies and standards. 

The call for consultants focused on two sectors: tree plantation-based green credits and water conservation-based green credits, revealing the government’s focus. According to the draft rules, tree plantation-based credits would be given for activities that boosted the number of trees.  Water-based credits include water conservation, water harvesting  and increasing water-use efficiency.

Tushar Dash, an independent researcher who works on forest rights and governance, alleged the green credit programme was a cover to “institutionalise a complicated legal and political architecture for privatisation of forests and facilitating the entry of market institutions in afforestation programs”.

“Instead of dispensing with the consultation process altogether, it was carried through a truncated exercise,” said Kanchi Kohli, an environmental law and policy researcher.  For ICFRE to then start hiring consultants, she added, “can unfortunately give the impression that the call for comments was never meant to influence the outcome of the draft rules”. 

On 24 July, while responding to a question in Lok Sabha on green credits, union minister of state for environment Ashwini Kumar Choubey said a “final notification” would be issued after considering stakeholder comments. The notifications do not clarify who these stakeholders were. 

Responding to another Lok Sabha question on 7 August on financial support to the green credit programme, Choubey said that the ministry had allocated Rs 1 crore in-principle to the ICFRE to develop the programme.

On 25 and 27 September, when Article 14 sought comment, over email and phone calls and messages to his office, on why public consultation was cut short, Choubey was not available for comment. 

‘Not Even Aware Of Scheme’

“How can the government claim that stakeholder consultation has been done when no gram sabha or community member in our state is even aware of this scheme?” asked Gopi Maji, state convenor of the Campaign for Survival and Dignity, a national advocacy forum of tribals and forest dwellers, based in Odisha. 

“The government only cares to consult with the big corporations and has made a mockery of the public consultation process,” said Maji. “We are already witnessing this in the case of the Forest Conservation Amendment Bill, where in spite of responses and objections being raised from all across the country, the government ignored it all and passed the Bill.” 

In 2022, the environment ministry introduced a Forest Conservation Bill that proposed amendments in the Forest Conservation Act of 1980, limiting its applicability to certain types of forest land. On  4 August 2023 , the Forest Conservation (Amendment) Act was notified by Parliament. 

Lifting protection for forests on certain categories of land from being cut for “development”, the amendments allow “linear projects”—referring to highways, railways, canals and dams—mining leases, creation of land banks without forest department approval. 

These exemptions violate the Forest Rights Act of 2006, which recognise rights of communities that depend on forests for livelihood on all types of forest land and require consent of gram sabhas before such “diversion”, to use the official term. 

Ignoring opposition,  on 4 August, the ministry notified the Forest (Conservation) Amendment Act of 2023 without any discussion in Parliament.  

Troubled History & Politics Of Green Credits

The history of green credits runs parallel to the history of attempts to privatise forests. This began not in New Delhi but in Gujarat in 2008 when Modi was chief minister. 

In December 2008, Modi announced that “Gujarat has moved forward by adopting the strategy of Green Credit, which is a step ahead beyond the Carbon-Credit”. He said that the proposal had already been approved by the United Progressive Alliance government of the time.

When Gujarat set up a department for climate change in February 2009, it announced a “Green Credit Movement”, similar to carbon credits.

In 2011, Modi mentioned, in an illustrated book by him on climate change, his discomfort with carbon credits because they “reflect wrongdoer’s penance in monetary terms”. He also spoke about green credits in this book.

The green credit scheme at this time proposed that the forest department would identify possible private or degraded lands for afforestation. Private applicants could plant trees on these lands. 

“Since 2014, project developers have been asking the government to ensure easy ways of getting land for compensatory afforestation,” said Dash. The green credit scheme idea is one of the solutions the government has proposed. A critical requirement for a developer that wants to use forest land is to get approval from the environment ministry. At the first stage of clearances, the forest department has to identify and allocate land to this project. Developers also have to pay the forest department a certain amount for compensatory afforestation. Only then will the developer receive a clearance.

“If companies can be given the option to raise their own plantations and trade them off, that is another way of getting faster clearances,” Dash said. 

With the green credit scheme, user agencies could purchase credits from other private players who have already planted trees on private land. This could mean that private tree plantations could end up replacing forests.

The concept mentioned in Modi’s book  was reiterated in a 2014 draft report on the Gujarat State Action Plan on Climate Change, which also said green credits would account not only for the area of afforestation but the value of the plantation, biomass yield and captured carbon.

Green Credit Idea Moves To Delhi

Once Modi became prime minister, the union government began its push for green credits. The government of Gujarat made a presentation on green credits at a meeting chaired by the secretary of the environment ministry in December 2014. Officials at the meeting decided to constitute a committee under the additional director general of forest conservation to prepare a similar scheme for the union government.

 On 26 June 2015, the committee made a presentation on private participation in afforestation before the secretary of the environment. The ministry approved afforestation guidelines that allowed companies and people to plant trees on private “degraded land”. It also submitted a concept note for green credits to the ministry in August 2015. 

In 2014, Prakash Javadekar, then the environment minister, told the Rajya Sabha that the Supreme Court would need to approve the scheme. In 2020 , the Indian Express quoted Jaipal Singh, a senior Gujarat forest official, as saying, “The Central Empowered Committee of the Supreme Court looked at the scheme and found the proposal untenable. There has not been any movement on the plan since.”

Despite rejection by the Supreme Court committee, the environment ministry continued to pursue the idea of privatised tree plantation. In 2016, the draft national forest policy proposed “production forestry” to facilitate a “forest industry interface”. In 2019, amendments to the Indian Forest Act of 1927 proposed the involvement of the private sector to create “production forests”. 

However, both suggestions were withdrawn after widespread opposition, including from the ministry of tribal affairs in 2018. Critics argued that opening forests to such public private partnership schemes would impact the Forest Rights Act, 2006, which recognises rights of Adivasis and other traditional forest-dwelling communities on all forest lands.

Despite the tribal affairs ministry pushback, the idea resurfaced once again under the label of the Green Credit Programme in 2019. 

On 6 July, 2019, as a part of the Indo-German Development Cooperation Project the environment ministry issued a call for proposals on “Operationalizing Green Credit Programmes in India”.  

The forest advisory committee, which scrutinises requests to divert forest lands to non-forest uses, in December 2019 said that private plantations in non-forest areas would help India meet its sustainable development goals and nationally determined contributions to mitigate climate change. It added that such plantations would be accepted as compensatory afforestation and recommended that the environment ministry issue guidelines.

For a year after, there was no evident movement on the scheme. In a June 2021 right-to-information-act response accessed by the writers, the ministry even said that it had “decided not to take any further action on the proposal of ‘Green Credit Scheme’ in the form as was proposed by Government of Gujarat”. 

 Green Credits@2023

All the background work to push green credits finally became evident as India took over the G20 presidency in December 2022. 

In January 2023, the environment ministry notified guidelines for a programme similar to the green credit scheme envisioned by the government of Gujarat, calling it “accredited compensatory afforestation”. 

Accredited compensatory afforestation allows private companies and people to plant trees on any land, which would then be counted as compensation for the diversion of forest land. The guidelines said that compensatory afforestation by the state faced problems of delayed funds and unavailability of forest land, which is why private landowners and government institutions should be encouraged to plant trees outside forest lands. 

Meanwhile, finance minister Nirmala Sitharaman announced a green credit programme in her budget speech on 1 February 2023. The green credit programme establishes a direct link between green credits and accredited compensatory afforestation by requiring those involved in such afforestation to  register under a green credit registry. This way it makes any kind of accredited compensatory afforestation  eligible for earning and being allocated green credits. The ACAs will become compensatory afforestation and then can be traded against the diversion of land for non-forest purposes. 

Delhi-based environmental lawyer Puja, who uses only one name,  stressed that the government is “promoting marketisation of the environment, ecosystems and forests by seeking to incentivise such activities… which can fall under the green credit programme”. Puja said it was “the duty of the state” to protect the environment and prevent environmental pollution.  

Instead, the state, said Puja, puts the burden on “consumers to be conscious towards the environment and Adivasis to be the service providers of environmental services without any corresponding rights”.

Maji of the Campaign for Survival and Dignity alleged the concept of credits would help corporate and industrial interests to “bandage” their destruction of ecosystems. 

“I am from the Gond tribe. We have lived, managed, and conserved the forests and ecosystems for generations,” said Maji. “We don’t need to earn credits through any credit scheme. The Forest Rights Act of 2006 already recognises our rights and vests them in us, but these privatisation and credit schemes are now trying to interfere with our rights and our lands.”

(Aditi Vajpeyi is an independent researcher and writer based in Himachal Pradesh and Mridula Chari is an independent journalist based in Mumbai.) 

Get exclusive access to new databases, expert analyses, weekly newsletters, book excerpts and new ideas on democracy, law and society in India. Subscribe to Article 14.