India's Carbon Market Is Entering a New Era: Manish Dabkara on Compliance Trading, Article 6, and Net-Zero Growth
India's carbon market is entering a new phase with compliance trading, Article 6 opportunities, and growing net-zero commitments. Manish Dabkara shares insights on carbon credit integrity, climate finance, MSME participation, and the future of decarbonization.
India's carbon market is entering a transformative phase with the rollout of the Carbon Credit Trading Scheme (CCTS) and the expansion of Article 6 mechanisms under the Paris Agreement. The global carbon credit market is projected to grow at a CAGR of over 25% through 2030, while India's carbon market is expected to witness rapid expansion as compliance-driven demand joins voluntary climate action. Growing corporate net-zero commitments, decarbonization regulations, and climate finance initiatives are expected to create significant opportunities across sectors ranging from renewable energy and green hydrogen to sustainable agriculture and industrial efficiency.
As carbon markets evolve from voluntary participation to a more structured compliance framework, transparency, integrity, and accessibility will become increasingly important. In this interview, Manish Dabkara, Chairman and Managing Director of EKI Energy Services Ltd., shares his perspectives on India's emerging carbon trading ecosystem, Article 6 opportunities, carbon credit quality, MSME participation, and the future of credible decarbonization.
The Shift from Voluntary Carbon Markets to a Compliance-Driven Ecosystem
StartupTalky: India's Carbon Credit Trading Scheme is setting emission reduction mandates for key sectors. As the market moves from voluntary to compliance-based mechanisms, what changes fundamentally about how companies engage with carbon credits, and what does that mean for the integrity and liquidity of the market?
Manish Dabkara: The introduction of the Carbon Credit Trading Scheme marks a significant milestone in India's climate journey. In a voluntary market, organisations typically participate based on their sustainability ambitions, net-zero commitments, or stakeholder expectations. A compliance market changes that dynamic by embedding carbon management into core business strategy and operational decision-making.
What is particularly significant is that carbon credits are no longer viewed solely as an instrument for voluntary climate action; they become part of a broader framework for managing regulatory obligations while driving efficiency and innovation. This creates stronger demand signals, greater market participation, and a more structured ecosystem.
For the market itself, integrity and liquidity must develop together. Liquidity grows when more participants actively engage in trading, while integrity depends on robust methodologies, transparent monitoring, and credible verification processes. A well-designed compliance framework has the potential to strengthen both, creating confidence among participants and supporting the long-term development of a credible and effective carbon market in India.
Energy Security Challenges and Their Impact on Carbon Market Demand
StartupTalky: The global energy crisis triggered by the Iran war is accelerating fossil fuel consumption in several countries buying emergency supplies. Does a period of elevated fossil fuel use create pressure on voluntary carbon markets, or does it actually increase corporate urgency to offset unavoidable emissions?
Manish Dabkara: Energy security challenges can sometimes lead to a short-term increase in fossil fuel consumption as countries prioritise reliability and affordability. However, we do not see this as weakening the long-term case for climate action or carbon markets.
If anything, periods of volatility reinforce the importance of building resilient, low-carbon economies. For businesses, the focus remains on reducing emissions where possible while managing those that are currently unavoidable. In that context, high-integrity carbon credits continue to play an important role within a broader decarbonisation strategy.
The key point is that carbon markets are most effective when they complement real emission reductions, not replace them. Market disruptions may influence energy choices in the near term, but the long-term direction remains unchanged: organisations are increasingly focused on managing climate risk, strengthening resilience, and progressing towards their sustainability commitments.
Defining High-Integrity Carbon Credits in an Evolving Market
StartupTalky: EKI has traded over 100 million carbon offsets to date. In your experience, what separates a high-integrity carbon credit that actually drives emissions reduction from one that is essentially a compliance paper exercise? How should buyers evaluate credits in a market that is still maturing?
Manish Dabkara: A high-integrity carbon credit represents a real, measurable, and independently verified climate benefit. The distinction is not simply about the credit itself, but about the quality of the underlying project, the robustness of the methodology, and the transparency of monitoring and verification.
As the market matures, buyers are becoming more discerning. They are looking beyond price and asking important questions around additionality, permanence, monitoring standards, and broader environmental and social impact. That is a positive development for the market.
Carbon credits deliver the greatest value when they are used as part of a wider decarbonisation strategy rather than as a standalone solution. For buyers, credibility comes from partnering with trusted project developers, relying on recognised standards, and prioritising quality over volume. Ultimately, confidence in carbon markets is built on integrity, and integrity remains the foundation for long-term growth.
Unlocking Global Climate Finance Through Article 6.2 Mechanisms
StartupTalky: India's Article 6.2 bilateral carbon market mechanism now includes 13 approved activity categories. What does this open for Indian project developers, and how does bilateral trading under Article 6.2 differ in practice from selling into the voluntary market?
Manish Dabkara: The inclusion of 13 approved activity categories under Article 6.2 is a significant opportunity for Indian project developers, particularly in emerging sectors such as green hydrogen, compressed biogas, offshore wind, sustainable aviation fuel, advanced energy efficiency, green ammonia, and carbon capture technologies. Beyond carbon revenues, it can help attract international investment, technology transfer, and long-term partnerships into India's low-carbon economy.
What distinguishes Article 6.2 from the voluntary market is that these transactions take place through government-to-government cooperation under the Paris Agreement. The emission reductions are transferred as internationally recognised outcomes and are subject to corresponding adjustments, ensuring they are counted only once. In contrast, voluntary market credits are typically purchased by companies to support their climate goals. As a result, Article 6.2 introduces a higher level of policy alignment, transparency, and international accountability while opening access to a new pool of climate finance.
Carbon Markets as Catalysts for Decarbonization and Clean Technology Investment
StartupTalky: Critics of carbon markets argue that they allow large emitters to delay the harder work of actual decarbonisation. As the architect of India's largest carbon trading company, how do you respond to that critique, and what structural design features would make carbon markets more credibly transformative?
Manish Dabkara: Carbon markets should never be viewed as a substitute for decarbonisation. Their purpose is to complement it. The most credible organisations first focus on reducing emissions within their operations and value chains, while using carbon credits to address emissions that are currently difficult or costly to eliminate.
The effectiveness of any carbon market ultimately depends on its integrity. Strong methodologies, transparent monitoring and verification, high-quality projects, and clear safeguards against double-counting are essential. Equally important is ensuring that carbon finance reaches projects that deliver real and measurable climate impact.
When designed well, carbon markets do more than offset emissions. They create economic incentives that accelerate investment in low-carbon technologies and climate solutions at scale.
Empowering MSMEs to Participate in India's Carbon Economy
StartupTalky: Many Indian MSMEs, particularly in manufacturing and agriculture, are sitting on carbon credit potential they are completely unaware of. What is the cost and complexity of registering and monetising a carbon project for a small business, and what infrastructure needs to be developed to make this accessible?
Manish Dabkara: Many MSMEs are already undertaking activities that generate measurable emission reductions, but most are unaware that these actions can create carbon value. The challenge is not the opportunity; it is the cost and complexity of project development, monitoring, verification, and market access.
For a small business, participating independently can often be impractical. The way forward lies in building a more enabling ecosystem through aggregation models, simplified methodologies, digital monitoring platforms, and greater technical support. As carbon markets evolve, accessibility will be just as important as integrity.
If we can reduce transaction barriers and make participation easier, MSMEs can become an important contributor to India's carbon market while unlocking new revenue streams and sustainability benefits.
Strengthening Carbon Accounting and Building Credible Net-Zero Roadmaps
StartupTalky: You have spoken about decarbonisation becoming real only when claims survive audits and regulatory scrutiny. As India's carbon accounting standards mature, what are the most common gaps companies have in their current emissions reporting, and what does a credible net-zero roadmap actually require?
Manish Dabkara: As expectations around climate disclosures continue to evolve, the biggest challenge is no longer reporting emissions; it is reporting them with accuracy, consistency, and transparency. Many organisations have made good progress on Scope 1 and Scope 2 emissions, but gaps often remain in areas such as Scope 3 emissions, data quality, supplier engagement, and audit readiness.
A credible net-zero roadmap goes beyond setting a target year. It requires a clear emissions baseline, science-aligned reduction pathways, measurable interim milestones, robust governance, and transparent reporting. Most importantly, it must be embedded within business strategy and supported by real operational changes.
Net-zero is not defined by ambition alone. It is defined by the ability to demonstrate progress, withstand scrutiny, and deliver measurable outcomes over time.
Apoorva Bajj
