India’s Gujarat emissions-trading pilot heads to Brazil, offering model for Delhi
Gujarat’s emissions-trading scheme, proven to cut factory particulate output, is being considered for adoption in Rio de Janeiro, and may inform Delhi’s air-quality strategy.
About fifteen years after a small group of economists and engineers began probing ways to curb factory smoke without forcing closures, Gujarat launched an emissions-trading scheme in Surat in 2019. The randomized pilot, run with EPIC, J-PAL and the Gujarat Pollution Control Board, covered 162 coal-firing plants and achieved 20-30% reductions in particulate matter while cutting compliance costs by roughly 11%, with a 99% compliance rate.
The success led to nationwide rollout, now reaching nearly 300 million people and expanding to sulfur dioxide and wastewater controls. Following its 2025 Earthshot Prize finalist recognition, the scheme attracted interest from Rio de Janeiro, which signed a letter of intent to study a comparable market, potentially becoming South America’s first industrial ETS. Experts say the Gujarat model could offer Delhi-NCR a different approach, rewarding cleaner factories rather than relying on inspections and shutdowns, though they caution it cannot be copied wholesale.
Why it matters
Demonstrates a scalable, market-based tool for cutting industrial air pollution that could be adopted worldwide.
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