Study Details

CDM-to-PACM: Practical Guide for Indian Industry and Global Carbon Market Stakeholders

Carbon markets can help industry mobilise investment, adopt cleaner technologies and advance climate action. Realising this potential requires clear rules, credible mitigation outcomes and confidence among governments, businesses and buyers.

The transition from the Clean Development Mechanism (CDM) to the Paris Agreement Crediting Mechanism (PACM) under Article 6.4 presents an opportunity to build on India’s carbon-market experience. It also calls for a fresh assessment of existing projects, future opportunities and participation requirements. Past registration or credit issuance should not be taken as assurance of future eligibility or commercial value.

This brief provides a practical reference for legacy CDM project developers, Indian corporates with mitigation assets, MSMEs and supply-chain companies, financial institutions, banks and investors. It is also intended for ESG and sustainability teams, carbon market consultants and advisors, validation and verification bodies, technology and MRV providers, corporate buyers of carbon credits, sector associations, FICCI committees and state-level industry bodies. Policymakers and government stakeholders seeking structured industry feedback form another important audience.

For government, the brief can help identify where industry needs greater clarity, capacity and engagement on PACM, Article 6.4 and future carbon-market participation. It brings together practical questions related to project eligibility, methodologies, monitoring, reporting and verification (MRV), approval processes, authorisation, incentives and international market access. It can also inform dialogue on how businesses view carbon markets within wider climate action, including technology deployment, bilateral cooperation, CORSIA-related opportunities and carbon-related trade measures.

For industry, the brief explains what follows CDM and how companies can prepare for potential PACM opportunities. It supports the assessment of legacy experience and new mitigation projects, the identification of MRV and technology needs, and an understanding of buyer and financier expectations. It also considers how CORSIA, CBAM and other international climate-related trade measures may influence business decisions, while distinguishing their purposes and requirements.

Key Takeaways