The National Stock Exchange (NSE) plans to diversify its offerings and transform into a multi-asset stock exchange and is exploring opportunities in the electricity derivatives and voluntary carbon credit (VCC) market for the same. 

It also plans to introduce derivatives contracts based on the government and corporate bond indices. These contracts will provide a new path for investors to hedge the performance of the bond markets. The implementation of these contracts is subject to the regulators’ approval. 

In an interview, the NSE Chief Business Development Officer, Sriram Krishnam, stated that about 26 million VCCs are available in India, with only two markets to trade them. He estimated the worth of these contracts to be around $150 million. Given the annual production of carbon credits in India, he emphasised the need for a healthy market for monetising these contacts. 

The Indian Energy Exchange (IEX) has established a wholly-owned subsidiary to explore business opportunities in the VCC market.

The government will establish a national framework to decarbonise the Indian economy, pricing greenhouse gas (GHG) emissions through trading of the carbon credit certificates under the Indian Carbon Market (ICM). The Bureau of Energy Efficiency, the Ministry of Power, and the Ministry of Environment, Forest & Climate Change are developing the Carbon Credit Trading Scheme for this purpose.