| Summary: | Carbon credits, a voluntary market mechanism to reduce greenhouse gas (GHG) emissions, can incentivize climate action. We evaluate the potential and eligibility of Conservation Agriculture (CA) practices for carbon credit generation in India under Verra's VM0042 methodology. Using farmer surveys and remote sensing data, we assess the eligibility based on the following conditions: Additionality Condition (GHG emission reductions to exceed legal requirements and the weighted mean adoption rate to be < 20% of area in the baseline), Yield Penalty Condition (no > 5% decrease in crop yields), and Quantitative Adjustment Condition (reduction in chemical fertilizer use by > 5%). Our analysis shows that CA has the potential to increase farmers’ carbon credit earnings by USD 18/ha and USD 30/ha in Bihar and Punjab, respectively. Punjab's ban on crop residue burning and the fact that > 20% of the area unburned limits the full economic realization of CA through carbon markets, decreasing potential income to USD 16/ha. A 60% increase in carbon prices from the current norm (USD 25) is required to encourage wider adoption of CA. Zero tillage of wheat in both Punjab and Bihar and reduction of nitrogen fertilizer overuse in Punjab fulfil all the conditions and are eligible for carbon farming projects.
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