A recent report has said that Bangladesh can earn nearly US$ 1 billion annually from the sale of carbon credits to be generated through the nationwide 25 crore tree plantation.
Citing the estimates of the World Bank, the report has said that successful implementation of the nationwide programme to plant 25 crore trees over the next five years could enable Bangladesh to earn this amount annually from the sale of carbon credits generated through tree plantation activities alone.
“Beyond its economic benefits, the initiative is expected to deliver substantial environmental gains, including lower temperatures, enhanced rainfall patterns, improved soil quality, and increased ecosystem resilience,” the Ministry of Environment, Forest and Climate Change has said citing its report.
Bangladesh is not new in carbon trading, in 2006, Infrastructure Development Company Limited (IDCOL) registered Bangladesh's first Clean Development Mechanism (CDM) project with the UNFCCC.
Since then, IDCOL has sold 2.53 million carbon credits, generating US$ 16.25 million (about Taka 170 crore at current exchange rates) from projects including solar home systems and improved cookstoves.
“This track record demonstrates Bangladesh's technical capacity for carbon project development and establishes a credible foundation for scaling up carbon market participation,” it said.
In June 13 last, Prime Minister Tarique Rahman formally inaugurated the nationwide programme to plant 25 crore trees over the next five years aiming to strengthen environmental protection and address the adverse impacts of climate change.
By contributing to carbon sequestration and reducing net greenhouse gas emissions, the initiative can attract financial returns through carbon credit trading, the report observes, it added.
In 2025, the global carbon pricing revenues reached US$ 107 billion, an increase of around two percent from 2024 levels in real terms. The current estimated capacity of the market is US$ 250 billion, with a projected increase to US$ 1 trillion by 2050, where the main source of investment in this area will be the private sector.
Countries should demonstrably showcase the implementation of these projects to attract additional investment.
If carbon reduction programmes are correctly structured and executed, Bangladesh could generate significant annual revenue from global carbon trading, given its status as one of the world's lowest per-capita greenhouse gas emitters, the report says.
It reveals that despite this potential, Bangladesh is not yet equipped to fully participate in international carbon markets. Key gaps include limited technical knowledge of Article 6 mechanisms, an underdeveloped legal and regulatory framework for carbon credit issuance and trading, and insufficient private and public sector capacity for MRV and project certification.
Addressing these gaps through regulatory reform, capacity building, and institutional investment is a strategic priority for unlocking carbon finance as a meaningful contributor to Bangladesh's climate finance portfolio, the report mentions.
They allow governments, companies, and institutions to offset their emissions by purchasing verified reductions from other entities, thereby creating financial incentives for low-carbon investment.
These mechanisms operate under international frameworks, including Article 6 of the Paris Agreement and voluntary standards that require robust monitoring, reporting, and verification (MRV) systems, it said.
