The Green Credit Programme (GCP) rolled out by the Ministry of Environment, Forest and Climate Change in 2023 was flagged by the Ministry of Law and Justice before its rollout, over legality of the business model built into it. The ambitious government scheme seeks to invite voluntary participation in sectors ranging from plantations to water conservation in exchange of tradable credits. At present, the pilot on tree plantation and eco-restoration of degraded lands is underway. What is the Green Credit Programme? Prime Minister Narendra Modi and Sheikh Mohammed bin Zayed Al Nahyan, the President of the UAE, officially unveiled the GCP on December 1, 2023, during the annual United Nations climate conference in Dubai. It was dubbed as a mechanism to incentivise “pro-planet” actions in response to climate change, and one which would promote the Centre’s Mission LiFE (Lifestyle for Sustainable Environment). The Union Environment Ministry notified the Green Credit Rules, which spelt out the programme’s objectives and implementation, in October 2023. At its core, the GCP seeks voluntary participation (read investments) of individuals, companies, industries, and other entities across seven different activities — such as tree plantation, waste management, and water conservation — that will lead to improvements in the environment. This participation will be incentivised by generating “green credits”, which can then be traded on a domestic market platform to potential buyers looking to meet sustainability targets, or existing legal obligations. For instance, could be exchanged for meeting compliance of compensatory afforestation, in cases where forest land has been used for development projects, as per a February 2024 notification spelling out the methodology for calculating green credits. The credits can also be used by listed companies as part of their environmental, social and governance disclosures under SEBI’s Business Responsibility and Sustainability framework, indicating efforts taken by these companies on environmental sustainability. How will green credits be calculated? To begin with, the Centre has rolled out the scheme through the pilot on tree plantation, which was later expanded to eco-restoration activities such as plantation of shrubs, herbs and grasses, soil moisture conservation, rain water harvesting, and other similar measures as per site suitability. Under GCP pilot on tree plantation and eco-restoration, the Indian Council of Forestry Research and Education, Dehradun, will act as the nodal administrator. Plantations will be carried out in degraded land parcels including open forest, scrubland, wasteland and catchment areas, and they must be five hectares in size or above. Forest departments of states and Union Territories would have to identify these land parcels, which are under their control. Any party interested in participating would have to apply and register with ICFRE. After processing the applications and charging a fee, the land parcels identified by forest departments would be allotted to the parties. It would be the forest department’s responsibility to carry out and maintain the tree plantations, and the plantation would have to be completed within a period of two years after the money is paid. One grown tree raised on the identified land parcels would be accounted as one green credit. This would be subject to a minimum density of 1,100 trees per hectare based on local silvi-climatic conditions and after certification of completion provided by the forest department. As on March 4, 2364 land parcels spread over 54,669.46 hectares were registered by forest departments across 17 states, as per GCP progress status data shared by the union environment ministry in Parliament. So far, a total of 384 entities have registered for participation in the GCP, including 41 public-sector undertakings and central public sector undertakings. What have some people criticised the scheme? GCP has been criticised for incentivising forest diversion for industries, by generating tradable credits which could also be used to meet legal obligations such as compensatory afforestation. It has also been criticised for promoting plantations on degraded lands, open forests and scrub lands, which experts have argued offer unique and important ecological services. Earlier this month, the Supreme Court also heard an intervention application on the GCP, in an on-going case challenging the amendments to the Forest Conservation Act. The plea questioned the survival issues of plantations raised under the scheme, and the SC Bench has sought the Environment Ministry’s views on the matter. Under the Van (Sanrakshan Evam Samvardhan) Adhiniyam, 2023, India’s forest conservation law, non-forest land equivalent to forest land used for industries and development projects is mandated for compensatory afforestation. Only if non-forest land is unavailable, twice the size of degraded or unclassed forest land is used for compensatory afforestation. This is to ensure land-for-land compensation. However, GCP mandates use of degraded forest land for plantations. It also has complementary provisions which allow exchange of credits, generated by paying money, for meeting the compensatory afforestation compliance. This translates into compensating for older forests with existing forest land, rather than adding non-forest land into the forest cover, as laid down in the Van Adhiniyam. “The Green Credit generated under the said Rules, may be exchanged for meeting the compliance of the compensatory afforestation in case of diversion of forest land for non-forestry purposes under the Van (Sanrakshan Evam Samvardhan) Adhiniyam, 1980 (69 of 1980), as applicable,” the February 2024 methodology on tree plantation based credit states. The Green Credit Rules, also states in its objectives that the programme shall encourage industries, companies and other entities to meet their existing obligations or other obligations under any law for the time being in force. In April 2024, over 100 environmental organisations and 400 citizens demanded the government to rollback the scheme. The representation to the government stated that arbitrary tree plantation cannot be used as credit to compensate for old-growth forests.
