Nepal’s carbon market potential

Although political will and foundational institutions exist, our success depends on quick, strategic action.

One of the most significant outcomes of COP29 in Baku, Azerbaijan, was the near completion of Article 6, a key provision of the Paris Agreement (PA) that facilitates international carbon trading and cooperation. This mechanism is divided into three key components : Article 6.2, which enables bilateral or multilateral carbon trading through Internationally Transferred Mitigation Outcomes (ITMOs); Article 6.4, which establishes a UN-regulated carbon market similar to the Clean Development Mechanism (CDM) where emissions reduction projects can generate and trade credits; and Article 6.8, which promotes non-market-based cooperation such as technology transfers and policy coordination to support global emissions reductions.