New Delhi: India’s agricultural carbon market has moved from policy discussions to the farm level, with more than 2,500 smallholder farmers in Punjab and Haryana receiving digital payments for adopting regenerative farming practices.
The first payments were released at a programme organised at Punjab Agricultural University (PAU), Ludhiana), marking a new link between sustainable farming practices, scientifically verified carbon reductions and additional income for farmers.
Dr M. L. Jat, Secretary, Department of Agricultural Research and Education (DARE) and Director General, ICAR, initiated the Direct Benefit Transfer (DBT) to 2,550 farmers from Punjab and Haryana.
Over ₹2.9 Crore to Be Disbursed to Farmers
The payments are part of ‘Aadi’, a farmer carbon programme launched by Grow Indigo in 2019 with technical guidance from the Indian Council of Agricultural Research (ICAR).
Under the programme, participating farmers adopted regenerative agricultural practices between 2019 and 2022, including:
- Direct Seeded Rice (DSR)
- Reduced tillage
- Crop residue management
- Improved water-use practices
The resulting greenhouse-gas reductions and increases in soil carbon were measured and independently verified before carbon credits were issued.
The programme covers more than two million acres and over 100,000 farmers across seven states and has issued agricultural carbon credits under the Verra VM0042 methodology.
Read also: APEDA Signs MoU to Boost India’s Food Exports at Gulfood 2027, MSMEs and FPOs in Focus
Farmers Receive Payments Linked to Carbon Credits
Farmers were paid according to their share of the carbon credits generated from their fields.
For the first issuance:
- Around 30,000 acres were covered.
- More than 50,000 carbon credits were issued.
- Participating farmers received approximately ₹3,000 to ₹15,000.
- Grow Indigo released the payments digitally from its own funds before the credits were fully sold.
This arrangement enabled farmers to receive payments without having to wait for the sale proceeds from the carbon credits.
Farmers were also given a choice between an assured upfront payment and 75% of the net carbon revenue after the credits were sold.
Farmers who joined the programme after 2022 are part of the next monitoring cycle and will receive payments as their carbon credits are issued.
Scientific Measurement and Verification Behind Carbon Payments
The carbon payments followed a multi-year process of measurement, assessment and independent verification.
ICAR institutions contributed scientific and field-level expertise to the programme in several areas, including:
- Greenhouse-gas accounting
- Crop-simulation modelling
- Soil-sampling protocols
- Device validation
- Field-team training
- Satellite and remote-sensing techniques
The ICAR–Indian Agricultural Research Institute (IARI), New Delhi, contributed to these processes. Grow Indigo is also working with ICAR–Agricultural Technology Application Research Institute (ATARI), Zone 1, to promote regenerative agriculture.
The scientific framework is intended to ensure that the environmental outcomes associated with farming practices are measured before carbon credits are generated.
Regenerative Farming Can Support Water and Air Conservation
The carbon payments provide an economic incentive for farming practices that can also deliver environmental benefits.
Direct Seeded Rice (DSR) can reduce irrigation requirements compared with conventional rice transplanting, while improved crop-residue management can help reduce stubble burning and associated air pollution.
For enrolled fields during 2019–2022, the programme estimates:
- 45 billion litres of water saved
- More than 2 lakh tonnes of crop residue kept out of fires
- An estimated 1,000 tonnes of PM2.5 emissions avoided
These outcomes highlight the potential of regenerative agricultural practices to combine farm productivity with resource conservation and climate-related benefits.
ICAR Highlights Farmer-Centric Agricultural Research
Dr M. L. Jat said the initiative demonstrates how climate-smart farming practices, supported by scientific assessment and rigorous verification, can create additional income opportunities for smallholder farmers.
He also highlighted the potential of such practices to contribute to water conservation and improved air quality.
Jat congratulated the participating farmers and acknowledged the contribution of ICAR institutions to the scientific framework supporting the initiative.
The initiative builds on a broader transition towards regenerative agriculture in Punjab and Haryana, including crop-residue management, water conservation and farming systems focused on improving soil health and climate resilience.
Agriculture Minister Highlights Sustainable Farming Practices
During his visits to Punjab under the Viksit Krishi Sankalp Abhiyan and subsequent engagements with farmers and agricultural institutions, Union Minister for Agriculture and Farmers’ Welfare Shivraj Singh Chouhan has emphasised farmer-centric agricultural research and field-level adoption of sustainable technologies.
He has highlighted the importance of practices such as direct-seeded rice and crop-residue management.
During his visit to Punjab in June 2025, Chouhan interacted with farmers and reviewed farming practices as part of the campaign.
Farmers Share Experiences With Regenerative Agriculture
Dr Usha Barwale Zehr, Executive Director of Grow Indigo, described the payment as the first instance in India of farmers being paid for carbon stored in their soil.
She also acknowledged the trust and patience of participating farmers during the scientific assessment and verification process.
Farmers Harinderjeet Gill of Nurpur Bet, Ludhiana, and Amandeep Kaur of Sangrur shared their experiences at the programme. They highlighted the economic and environmental benefits associated with continuing regenerative practices and avoiding crop-residue burning.
Punjab Records Sharp Decline in Farm-Fire Incidents
The broader shift towards improved residue management has also coincided with a substantial decline in farm-fire incidents in Punjab.
According to government data, Punjab recorded 5,114 farm-fire incidents during the 2025 paddy harvesting season, the lowest number since monitoring under the present framework began.
This represented:
- A 93% reduction compared with 2021
- A 90% reduction compared with 2022
The Ransinh Kalan model in Moga has also demonstrated the potential of sustained residue-management efforts. The village maintained a 100% residue-burning-free status across 1,310 acres for six consecutive years.
ICAR, Agricultural Universities and KVKs Support Wider Adoption
The initiative is part of a wider agricultural transformation supported by ICAR, agricultural universities, Krishi Vigyan Kendras (KVKs) and State institutions.
Field-level experiences are helping build a foundation for wider adoption of practices such as:
- Crop-residue retention
- Minimum soil disturbance
- Direct Seeded Rice
- Diversified cropping
- Improved soil biology
- Efficient water use
The broader objective is to integrate sustainability and productivity into farming systems while improving climate resilience and resource efficiency.
India Takes Regenerative Agriculture Agenda to BRICS
The significance of these developments also extends to international agricultural cooperation.
The 16th BRICS Agriculture Ministers’ Meeting, held in Indore in June 2026 under India’s chairship, agreed to establish a BRICS Network of Centres of Excellence on Agroecology and Regenerative Agriculture for Climate Resilience and Productivity.
The network will initially be coordinated by ICAR–Indian Institute of Farming System Research (IIFSR), Modipuram.
The BRICS New Delhi Declaration, adopted in September 2026, subsequently welcomed the strengthening of cooperation through this network.
Soil Carbon Payments Link Sustainability With Farmer Income
The Ludhiana initiative brings together three key dimensions of India’s agricultural transformation: farmer-centric, field-based agricultural research; ICAR’s Lab-to-Land approach; and international cooperation on sustainable agricultural practices.
Through its research institutions, ATARIs and KVKs, ICAR is supporting the transfer of scientific knowledge and technologies to farmers.
The first soil-carbon payments demonstrate how scientifically measured environmental outcomes can be linked with economic incentives for farmers. The approach connects regenerative farming with additional income while supporting water conservation, reduced crop-residue burning, climate resilience and sustainable agricultural production.
Read also: World Ozone Day 2026: India Launches Net Zero Portal, Climate Dashboard to Track National Action
