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India and Japan have finalised the rules for a new carbon credit partnership called the Joint Crediting Mechanism (JCM), under the Paris climate agreement, officials said on Tuesday. Under the arrangement, Japanese investment and technology can help fund projects in India that reduce or remove greenhouse gas emissions. Carbon credits can also be shared between the two countries to help meet their climate targets, officials said.
India and Japan signed the Memorandum of Cooperation (MoC) for the JCM last year. The environment, forest, and climate change ministry said the rules for the implementation of the credit mechanism were adopted on June 8.
“The Government of the Republic of India and the Government of Japan have adopted the ‘Rule of Implementation’ of the Joint Crediting Mechanism on June 8, 2026, under Article 6.2 of the Paris Agreement of the United Nations Framework Convention on Climate Change (UNFCCC),” the ministry said in a statement on Tuesday.
The MoC established a framework for collaboration on mitigation activities that deliver greenhouse gas emission reductions or removals, while supporting sustainable development outcomes in India and contributing to the achievement of the Nationally Determined Contributions (NDCs) of both countries.
Officials said the Rule of Implementation defines robust governance arrangements, including a Joint Committee which will have representatives from both governments, transparent project approval procedures, third-party validation and verification, sustainable development safeguards, and national registries to track the issuance and transfer of credits.
The government said the mechanism will help attract investment, bring low-carbon technologies to India, build technical capacity, and support projects that cut emissions while contributing to sustainable development. It also reinforces India’s commitment to climate action under the Paris Agreement.
“The Joint Crediting Mechanism demonstrates India’s firm commitment to climate action. It will catalyse investment, technology transfer, and capacity-building for projects involving low-carbon technologies in India to support climate change mitigation and sustainable development,” the ministry said.
On Tuesday, a new analysis released by Zero Carbon Analytics (ZCA) raised concerns over Asia’s growing reliance on liquefied natural gas (LNG), stating it could deepen fossil fuel dependence, expose economies to global price shocks, and drive emissions linked to worsening climate impacts across the region.
The analysis examined Japan’s role as one of the world’s largest LNG traders. It found that US LNG—resold by Japan to nine Asian countries between 2020 and 2025—generated emissions equivalent to those of approximately 17 coal-fired power plants operating for a year.
“Since 2021, Japan has sold more US LNG to other countries than it imported for domestic use. Between 2020 and 2025, around 31% of US LNG purchased and resold by Japan was shipped to Asia, including South Korea, China, India, Taiwan, Thailand, Singapore, Bangladesh, Pakistan, and Malaysia,” the study found.
It said an estimated 16.5 billion kg of US-produced LNG resold by Japan generated approximately 63.5 billion kg of CO2 emissions across the fuel’s full supply chain. “Emissions associated with these sales were equivalent to approximately 17 coal plants’ annual emissions.”
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