Potential of carbon credits in India's agriculture sector: Empowering small farmers for a sustainable future

The carbon-credit market presents a significant opportunity for the food and agriculture sector, particularly in India, where 86.1% of farmers are small and marginal. This article explores the basics of carbon credits, differentiating between compliance and voluntary markets, and examines the immense potential of agriculture in generating carbon credits through sustainable practices like agroforestry, conservation tillage, and water-efficient farming. The role of a robust institutional mechanism—including Panchayats, Block authorities, and District Agriculture Officers (DAOs)—is highlighted in facilitating small farmers' participation in carbon markets. The concept of bundling small & marginal farmers into Farmer Producer Organizations (FPOs) or cooperatives is discussed as a key strategy to achieve scalability, reduce transaction costs, and attract buyers. Additionally, the article outlines an effective marketing strategy for selling carbon credits, leveraging technology such as remote sensing and GIS for Monitoring, Reporting, and Verification (MRV) processes. Finally, the article emphasizes how carbon markets can provide income diversification, enhance climate resilience, and promote sustainable development in India's agriculture sector.