Opinion | Nepal’s carbon regulation moment
Summary
Nepal has introduced the Carbon Trading Regulation, 2025, opening avenues for market-based climate financing leveraging its vast forests, hydropower, and community forestry to generate environmental and economic benefits.
Key Points
- Nepal has launched the Carbon Trading Regulation, 2025, establishing a market-based approach to climate finance across various sectors.
- The regulation aligns with Nepal's commitments under the Paris Agreement, enabling international carbon credit trading and bilateral agreements like with Sweden.
- Nepal's natural assets, including extensive forests and hydropower, position it well to generate significant income through carbon markets potentially contributing 0.5 to 1 percent of GDP.
- Effective carbon governance, robust monitoring systems, and strategic prioritization of sectors such as hydropower and urban mobility are essential for Nepal to capitalize on this opportunity while safeguarding public and environmental interests.
