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UP pays for carbon credits to farmers in advance to motivate them

Lucknow, Jul 19, 2025

To promote agroforestry, UP has thought out of the box to start making pre payments to farmers for the carbon credits that they will supposedly earn five years from now.

While the trees on farmers' land, against which the partial payments have been made in advance, are yet to become repositories of carbon, 237 farmers who registered under the first phase of the carbon finance project of the UP govt until now have been made partial prepayments worth Rs 48.6 lakh already.

Sources in the forest department said that the prepayments have been made to motivate farmers. And, if after five years the trees, against which payments have been made, do not survive, the remaining amount will not be paid.

Farmers have been paid around Rs 10,000 per head as partial prepayment. The impact of it is already visible as, so far, 25,140 farmers have registered under the scheme for the first phase. The second phase of the scheme was launched about a month ago and registration under it has also started.

The govt made a partial advance payment because the base year for the scheme is 2024-25, which means farmers who planted saplings in 2024-25, or years after that, will draw benefits under it, but only after five years of planting the saplings.

Notably, in July 2024, UP had become the first state in the country to give advance partial payment to farmers against carbon credits, earned through plantation and its conservation.

Farmers earn carbon credits for reducing carbon emissions of greenhouse gases in the atmosphere because trees planted by them on their land absorb carbon dioxide from the atmosphere continuously for photosynthesis.

In the process, while trees keep the carbon stored, they give out oxygen, thus reducing carbon concentration in the air and improving its quality.One metric tonne of carbon dioxide stored in trees is one carbon credit, for which a beneficiary farmer is paid money equivalent to six dollars every five years.

The UP forest department has an agreement with TERI (The Energy and Resources Institute) and VNV Advisory Services on the project. While farmers register with the forest department at the divisional level, teams from TERI will verify and validate the claims made before the carbon credits are assessed and monetised.

“Until now, around Rs 25 lakh has been transferred to the Dudhwa Tiger Conservation Foundation to distribute as advance payment to farmers in the region. The process to distribute Rs 26.15 lakh to 408 beneficiary farmers is underway,” said sources in the forest department.

A farmer will draw payments against carbon credits for 30 years for the same plantation under the carbon finance project. “This amounts to an extra income for the farmer for only keeping the tree growing on its land,” said an official.

The scheme was implemented in six forest divisions last year, including Gorakhpur, Lucknow, Bareilly, Meerut, Moradabad, and Saharanpur. In the second phase, seven more divisions were covered under it, namely Devipatan, Ayodhya, Jhansi, Mirzapur, Kanpur, Varanasi, and Aligarh.

[The Times of India]

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