Green Credit Programme 2026: How Tree Plantation Green Credits Work

The Green Credit Programme is the government's way of turning a company's spending on forest restoration into a recognised, auditable unit. It was set up under the Green Credit Rules, 2023, notified in October 2023 under the Environment (Protection) Act, 1986. Tree plantation was the first activity to get a working methodology, and it is the one most companies ask us about.

The rules for tree plantation changed significantly in August 2025. If you read about the programme before then, some of what you read no longer applies. This guide explains how it works today.

What the Green Credit Programme covers

The Green Credit Rules list eight kinds of environmental activity that can earn Green Credits:

• Tree plantation
• Water management
• Sustainable agriculture
• Waste management
• Air pollution reduction
• Mangrove conservation and restoration
• Ecomark label development
• Sustainable building and infrastructure

The Indian Council of Forestry Research and Education (ICFRE) is the Administrator of the programme. It registers participants, runs the GCP portal and issues the credits. For tree plantation, the restoration work itself is carried out by the State or UT Forest Department.

How tree plantation under the GCP works, step by step

1. Register. Any entity, company, PSU, organisation or individual can register as a Green Credit Applicant on the GCP portal. ICFRE reviews and approves the registration.
2. Choose a land parcel. Plantation happens only on degraded forest land under the control of the State or UT Forest Department. Each parcel must be a compact area of at least 5 hectares, free of encumbrances. Wildlife sanctuaries, national parks and other protected areas are excluded.
3. Fund the restoration. The applicant pays for the restoration work, and the Forest Department carries it out: planting, soil and moisture conservation, fencing, removal of invasive species and fire protection.
4. Wait for the forest to establish. After five years of restoration, the land is evaluated.
5. Receive credits. If the parcel has reached a canopy density of at least 40%, the applicant can claim one Green Credit for each surviving tree that is more than five years old.

What changed in August 2025

The revised methodology was notified on 29 August 2025 (G.S.R. 592(E)). The earlier version, from February 2024, linked credits to the number of trees planted. The revised version links them to the forest that actually grows:

For companies, this is a good change. A credit now stands for a tree that has survived, which is much easier to defend in a sustainability report or in front of an auditor.

How companies can use Green Credits

Green Credits for tree plantation can be exchanged once, after which they are extinguished. According to the notification and the GCP FAQs, they can be used towards:

• Compensatory afforestation, when a project needs to divert forest land
• CSR obligations under the Companies Act, 2013
• Tree plantation conditions attached to project approvals and clearances
• ESG and BRSR reporting, as permitted by the applicable rules

Because the credits cannot be traded on a market, they are best thought of as a recognised record of restoration you paid for, not as an asset you can sell later. They are also different from carbon credits; see our guide Green credits vs carbon credits vs CSR vs BRSR.

Is the Green Credit Programme right for your company?

The GCP suits companies that:

• have a compensatory afforestation or plantation condition to meet, or expect one;
• want restoration on government forest land, carried out by the Forest Department;
• can commit funds now and wait five years for credits.

Many companies run plantation programmes alongside the GCP, for example on farmers' land (agroforestry), in cities (Miyawaki and urban forests) or along coasts (mangroves). These do not earn Green Credits, but they can be funded from CSR, reported in BRSR, and shown to employees and customers within months instead of years.

Whichever route you choose, the evidence matters more than the number of saplings: geo-tagged locations, species lists, survival checks and photographs over time. That is what an auditor, a board or a ministry evaluator will ask for.

Common mistakes to avoid

• Counting saplings as credits. Under the current rules, no credit exists until the five-year evaluation is done.
• Planning to sell credits. Tree plantation Green Credits are non-tradable outside your own group of companies.
• Using the same trees twice. Once exchanged, for CSR or for compensatory afforestation, the credits are extinguished.
• Confusing Green Credits with carbon credits. India's carbon market is a separate scheme, run by the Bureau of Energy Efficiency. See our guide to the Carbon Credit Trading Scheme.

Plan your plantation programme

We help companies plan plantation programmes that fit their CSR, ESG and compliance goals, and we report every tree with geo-tags and survival data. See how we support government mandates or plan a programme with our team.

Sources: Green Credit Programme FAQs · MoEFCC · Revised methodology notification G.S.R. 592(E), 29 Aug 2025 (summary). Last updated: October 2026. Rules change; check the latest notification before you rely on any detail.