India and Japan have completed the implementation framework for a new carbon credit partnership known as the Joint Crediting Mechanism (JCM) under the Paris Climate Agreement. Officials announced on Tuesday that the mechanism will allow Japanese investment and technology to support projects in India that reduce or remove greenhouse gas emissions. The carbon credits generated through these projects can be shared by both countries and used to achieve their respective climate goals.

The two countries had signed a Memorandum of Cooperation (MoC) for the Joint Crediting Mechanism in 2025. According to the Ministry of Environment, Forest and Climate Change, the rules required for implementing the mechanism were officially adopted on June 8, 2026.

“The Government of the Republic of India and the Government of Japan have adopted the ‘Rule of Implementation’ of the Joint Crediting Mechanism on June 8, 2026, under Article 6.2 of the Paris Agreement of the United Nations Framework Convention on Climate Change (UNFCCC),” the ministry said in a statement on Tuesday.

The MoC created a framework for cooperation between India and Japan on activities that help reduce or remove greenhouse gas emissions. These efforts are expected to support sustainable development in India while also helping both countries achieve their Nationally Determined Contributions (NDCs), which are their commitments under the Paris Agreement.

Officials said the newly adopted Rule of Implementation establishes a clear governance structure for the mechanism. It includes a Joint Committee made up of representatives from both governments. The framework also provides transparent procedures for project approvals, independent validation and verification by third parties, safeguards for sustainable development, and national registries that will monitor the issuance and transfer of carbon credits.

The government stated that the mechanism is expected to attract investment into India and encourage the use of low-carbon technologies. It is also expected to strengthen technical expertise and support projects that reduce emissions while contributing to sustainable development. According to officials, the initiative further strengthens India’s commitment to climate action under the Paris Agreement.

“The Joint Crediting Mechanism demonstrates India’s firm commitment to climate action. It will catalyse investment, technology transfer, and capacity-building for projects involving low-carbon technologies in India to support climate change mitigation and sustainable development,” the ministry said.

Meanwhile, a separate analysis released on Tuesday by Zero Carbon Analytics (ZCA) raised concerns about the increasing dependence on liquefied natural gas (LNG) across Asia. The report warned that greater reliance on LNG could lock countries into long-term fossil fuel use, increase vulnerability to international price fluctuations, and contribute to greenhouse gas emissions that worsen climate change impacts in the region.

The study focused on Japan’s position as one of the world's largest LNG traders. It examined the trade of LNG imported from the United States and later resold by Japan to other Asian countries between 2020 and 2025. According to the analysis, these LNG transactions resulted in emissions equivalent to those produced by around 17 coal-fired power plants operating for one year.

The report found that since 2021, Japan has exported more US-origin LNG to other countries than it has used domestically. Between 2020 and 2025, nearly 31 per cent of the US LNG purchased and resold by Japan was shipped to Asian nations. These included South Korea, China, India, Taiwan, Thailand, Singapore, Bangladesh, Pakistan, and Malaysia.

According to the study, approximately 16.5 billion kilograms of US-produced LNG that was resold by Japan generated about 63.5 billion kilograms of carbon dioxide emissions throughout its supply chain. This includes emissions from production, transportation, and final consumption of the fuel.

“Emissions associated with these sales were equivalent to approximately 17 coal plants’ annual emissions.”

The findings highlight the growing debate around Asia’s energy transition. While countries continue to seek reliable energy sources to support economic growth, climate experts have warned that increasing dependence on LNG could make it more difficult to achieve long-term emissions reduction goals. The contrast between initiatives such as the India-Japan Joint Crediting Mechanism and concerns over rising LNG use reflects the broader challenge of balancing energy needs with climate commitments.