Developing Carbon Finance Project for Farmers Adopting Regenerative Agriculture Practices in the Indo-Gangetic Plains
Aligned SDGs
- Developing Carbon Finance Project for Farmers Adopting Regenerative Agriculture Practices in the Indo-Gangetic Plains
- General overview
- Intervention
- Location
- Last data update
- Spreadsheet of data
- Developing Carbon Finance Project for Farmers Adopting Regenerative Agriculture Practices in the Indo-Gangetic Plains
- General overview
- Intervention
- Location
- Last data update
- Spreadsheet of data
General overview
Stage of development: Final negotiations
Policy sectors: Agriculture / Environment and climate change
Type of instrument: Payment-by-results (no pre-financing)
Delivery locations: India
Country classification: Lower-middle-income
Intervention
Social or environmental challenge
Varaha's outcome-based financing program addresses the underprovision of climate resilience and community benefits by the market. Currently, the market lacks monetary incentives for farmers to adopt regenerative agriculture practices. Furthermore, farmers face a lack of knowledge and access to equipment, due to the existing informational asymmetries. By quantifying and monetizing outcomes such as carbon sequestration, yield enhancement, and soil health improvement, Varaha's program provides tangible value to sustainable practices, thereby aligning incentives and alleviating risk for farmers. Varaha's Monitoring, Reporting, and Verification (MRV) system ensures transparency, overcoming information gaps. The program's emphasis on income diversification directly counters financial constraints faced by smallholders. In essence, Varaha's outcomes-based financing model transforms market failures into opportunities, incentivizing sustainable practices while fostering economic growth, resilience, and environmental stewardship.
Description of the intervention
Varaha envisions a pay-by-outcomes contract that can foster sustainable agricultural practices among the smallholders involved in Varaha's Regenerative Agriculture Practices in the Indo-Gangetic Plains project. The project empowers farmers to adopt regenerative practices, such as direct seeding, zero-till farming, and crop diversification, resulting in carbon sequestration, reduced emissions, and improved soil quality. Payments to farmers are tied to these quantifiable achievements, ensuring fair compensation for positive impacts. A comprehensive Measurement, Reporting, and Verification (MRV) system guarantees accuracy, transparency, and accountability. Critical to this initiative is the concept of an outcomes-based financing model, akin to a development impact bond. Smallholders benefit not only from increased yields and reduced input costs but also from an additional income stream generated through carbon finance. This incentivizes sustained commitment to regenerative practices. Varaha's outcomes-based financing project presents a blueprint for harnessing agriculture's potential as a climate solution, uniting environmental stewardship with economic prosperity.
Location
Country:
- India
Locality:
- India
Last data update
Data for this pipeline project was last updated in March 2024
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Spreadsheet of data
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