Mumbai: India is the second largest seller of carbon credits in the world with six per cent share in 2007 while China tops the list with a whopping 73 per cent share, a World Bank report said.
Carbon credits or `certified emission reductions (CER)', issued by the Clean Development Mechanism (CDM) executive board for emission reductions and verified under the rules of the Kyoto Protocol, are traded on the global climate exchanges.
"India and Brazil, at 6 per cent market share each, transacted the highest volumes after China in 2007," according to World Bank's `State and trends of the carbon market 2008' report.
China remained the world leader in CER supply for the third consecutive year, with a 73 per cent market share in terms of volumes last year against 54 per cent in 2006.
The report cited the attractiveness of China for buyers of carbon credits, due mainly to "the large size, economies of scale in origination, and its favourable investment climate."
China consolidated its position as the pre-eminent carbon credit supplier, by quadrupling its number of projects in the pipeline from January 2007 to March 2008, even as the high price expectations for CERs in India and Brazil have hindered market growth in the two countries, the report said.
China has 53 per cent of potential CER supply with 1,104 projects till 2012, compared to India's 15 per cent of the total CDM pipeline, it noted.
The report attributed Chin's lead to early regulatory efforts to mitigate climate change.
The total volume of carbon credits traded under a scheme in the Kyoto Protocol remained almost unchanged in 2007 as compared with 2006, the report pointed out.
The volume of carbon credits totalled 551 million tonnes worth of carbon in 2007, up slightly from 537 million tonnes in 2006 while it was about 350 million tonnes in 2005, nearly 100 million tonnes in 2004 and 50 million tonnes in 2003.
The report attributes the slow growth to complicated procedures for registering greenhouse gas reduction projects in developing countries. Also, developed countries like Japan, have been buying most of their carbon emissions reduction obligations under the Kyoto pact from projects in developing countries.
In California, US, which has been in the forefront of the battle for reversal of climate change, top campaigners Arnold Schwarzenegger and Nancy Pelosi have even used a forest of old trees to offset the carbon additions due to their air travel.