New Delhi: Ninety-six percent of Indian industry believes the Clean Development Mechanism (CDM) - investment in emission reduction projects - has contributed to sustainable development in the country, according to a survey released Thursday.
The FICCI survey titled `Impacts, Governance and Future of CDM - Indian Industry Perspective` found that amongst the investments made on energy efficiency and renewable energy projects, as many as 48 percent of respondents have made investments in energy efficiency projects followed by wind projects (28 percent).
"Indian industry has given big thumbs up to the continuation of CDM and market based mechanisms for climate change mitigation," it said.
"As high as 96 percent of respondents believe that CDM has contributed to sustainable development."
The CDM is a mechanism under the United Nations Framework Convention on Climate Change (UNFCCC) that allows a developed country to implement an emission-reduction project in developing countries. Such projects can earn saleable certified emission reduction (CER) credits.
The FICCI survey, however, reveals that as many as 71 percent respondents have also said the lack of sufficient number of Designated Operational Entities (DOEs) -- is an independent auditor to validate project proposals -- affects the registration process and even increases costs associated with the projects.
The survey saw representation from diverse sectors including cement, chemicals, fertilisers, hydro, iron and steel, mining, oil and gas, pulp and paper, power, solar, sugar, transport and wind.
Stakeholder participation included industry, consultants, civil society groups, academia and government.
The CDM has proved to be a useful mechanism for industry to implement climate change mitigation measures and renewable energy projects.
The UNFCCC had constituted a high-level panel on CDM in 2011 to carry out consultations to take stock of the lessons learnt, resulting in recommendations on how to best position it for a continued strong role in the post 2012 carbon markets.
The India consultation was conducted by FICCI.
According to the survey, India continues to be an important player in CDM as it accounts for more than 800 registered projects and along with China hosts more than 70 percent of CDM projects in the world.
"As of July 2012, more than 1,600 companies in India are part of the CDM portfolio across more than 50 sectors," the survey said.
"A total of 2355 projects have been approved by the Government of India out of which around 850 have been registered by the CDM Executive Board of the UNFCCC," it said.
These recommendations come at a crucial time ahead of the UN climate change conference to be held in Doha at end of November this year.
The Doha conference is expected to have discussions and negotiations on new market mechanisms to check emissions.