There was a palpable and building sense of unease at the residence of Arun Dutta Kadale upon enquiring about his mahogany plantation. Spread over 1 hectare (ha) at Navingar village in Maharashtra’s Pune district, the plantation is part of an agroforestry project that generates carbon credits. Kadale hopes to earn Rs 61,750 a year from these carbon credits.
For the uninitiated, carbon credits are issued against activities that either abate (such as by using an efficient cookstove or lighting system) or remove (for instance, by planting trees) greenhouse gases (GHGs) from the atmosphere. Each tonne of carbon dioxide or the equivalent GHGs (CO2e) avoided or removed generates one carbon credit, which is then bought by businesses that wish to offset their emissions or meet climate goals. “I set up the plantation in 2019, after one Pune-based Mahogani Vishwa Agro Private Limited (MVAPL) approached me and said I could earn more by participating in its carbon credit-backed agroforestry programme. It promised a cash incentive of Rs 25,000 a year from 2024, apart from Rs 2.75 crore from the sale of mahogany timber when the trees mature at 15 years. But I have not received the money yet,” Kadale said when Down To Earth (DTE) met him at his residence in November 2024, adding quickly, “I am confident that the company will deliver on its promise.”
By then, the atmosphere had grown tense. Kadale’s wife handed over a WhatsApp call to this reporter, introducing the caller as her daughter, though the profile picture was that of MVAPL’s whole-time director Sonali Shelke. The caller demanded to know how dte learned the whereabouts of Kadale. A crowd had also gathered outside their residence. When the reporter tried to leave, at least seven people on a tractor blocked the road. One of them introduced himself as Kadale’s son and claimed to be working for MAVPL. For the next 10 minutes, he interrogated the reporter about the purpose of the visit, while taking instruction from someone on the phone.
While the motive behind the hostile acts remains unknown, the sequence of events does indicate that the agroforestry project has much to hide. In fact, between September and December 2024, DTE visited six agroforestry projects, including two proposed ones, in 17 villages across states to understand their workings—only to encounter similar mystery, anxiety, fear and distress.
This is a matter of concern because there is now a high demand for agroforestry carbon credit projects in the global voluntary carbon market (VCM), which has flourished in the absence of an internationally negotiated agreement to govern the space. According to a report by Abatable, UK-based carbon procurement and market intelligence platform, fewer removal credits are now left unsold or unretired as companies compete over a limited supply of these high demand credits. “We expect the current level of demand to continue in the next two years,” it adds.
This boom is evident in India. Data with the Berkley Carbon Trading Project of the University of California, US, shows that as of January 2025 India accounts for one-fifth (91) of the 460 global afforestation and reforestation projects under various stages of consideration with Verra and Gold Standard—the world’s two leading carbon credit standard-setters that certify projects to receive credits. In 2011-21, less than 10 afforestation and reforestation projects from India were getting listed with Verra and Gold Standard annually; the number rose to over 40 in 2022, followed by more then 25 in 2023 as well as in 2024. As many as 10 projects, including the mahogany plantation of MVAPL, have received carbon credits.
The high demand for agroforestry carbon credit projects can also be gauged from the premium price they fetch in VCM. According to Abatable, in the past 12 months, afforestation and reforestation projects have generated carbon credits with prices in the range of US $1.2 to $90 per credit and a median price of $32.50—much higher than the price of carbon credits from projects such as avoided deforestation, improved forest management, sustainable agriculture, wetland restoration, renewable energy, industrial efficiency, waste management, cookstove efficiency and energy efficiency.
Industry analysts explain the reason for this growing demand in India. Siddhartha Dhabi, co-lead at the Centre for Grower-centric Eco-value Mechanisms (C-GEM), an initiative to develop farmer-centric carbon markets in India based on natural farming, says project developers in the country consider agroforestry a safe bet as the costs for implementing and monitoring trees are low and the methodologies are well-defined and standardised. Agroforestry also works in tandem with livelihood diversification through the sale of fruits and timber. Besides, agroforestry projects attract corporate social responsibility funds, reducing costs to project developers, Dhabi says.
Lambert Schneider, research coordinator for International Climate Policy at Oeko-Institut in Berlin, adds another reason. There is a high demand for projects with co-benefits, such as the ones that help local communities and have positive impact on the local environment. For example, companies like Meta Platforms Inc, Microsoft Corp, Google and Salesforce have teamed up to form the Symbiosis coalition, an advance market commitment to contract for up to 20 million tonnes of high-quality nature-based carbon removal credits by 2030. This, the coalition states, “will drive positive outcomes for people and planet”. One of the criteria listed for agro-forestry projects to be eligible is demonstrating the types and terms of community benefits conferred (whether direct or indirect financial benefits), and the proportion of those benefits that reach the community. Is this happening? DTE’s investigation is to explore how agroforestry projects are being implemented on the ground, benefit-sharing arrangements and challenges in the existing mechanism.
This article was originally published as part of the cover story The Great Farm Hustle, published in the March 1-15, 2025 print edition of Down To Earth
