Competitiveness and climate

Setting aggressive emission targets under the compliance regime will feed into the price of carbon credits, and eventually influence India's net zero emission targets

- S DINAKAR

India ignored the elephant in the room — iron and steel — when it announced new draft regulations last month for setting compulsory emission targets for greenhouse gases (GHGs) under the first phase of the country's Carbon Credit Trading Scheme (CCTS).

New Delhi put 282 units, falling under four sectors — aluminium, cement, chlor-alkali, and pulp and paper — on notice. The units belong to some of India's leading conglomerates like Vedanta, Hindalco, Nalco, UltraTech, ACC, Ambuja, Dalmia, and JSW Cement. For now, it has left out five sectors, including steel and refineries, targets for which will be announced later this year.

"Steel represents about 12 per cent of India's GHG emissions, and it is imperative that we solve this. Otherwise, India's vision of 'net zero' by 2070 is not going to be fulfilled," said Harsh Choudhry, chief executive officer (CEO) and cofounder of Sentra World, a Bengaluru-based startup specialising in providing a carbon accounting platform for industrial manufacturing.

In the case of steel, India introduced a green steel programme last December, parallel to the CCTS compliance regime, under which the government will procure a certain percentage of low-carbon steel for projects, said Sumit Bhatia, vice-president at ARS Steels, a low-carbon steel producer. The green procurement should start next year, officials said. But steel producers, including Tata, Jindal, AMNS and SAIL, are yet to be served emission targets under CCTS.

"The bigger question, which is actually a lot more complicated, is are these compliance targets aggressive enough," said Vaibhav Chaturvedi, senior fellow, New Delhi-based Council on Energy, Environment and Water, a global think tank.