Unlocking the Potential of Carbon Credits in Sri Lanka: Market Analysis, Scheme Benchmarking, and Evaluating Community-based Reforestation Programme

Thematic Area: Environment & Climate Change

Start Date: December 18, 2025

Carbon credits and biodiversity credits (bio-credits) are innovative financial instruments designed to manage greenhouse gas (GHG) emissions and enhance biodiversity. These instruments are widely recognised in global climate change and biodiversity policy frameworks; however, implementation challenges remain.

This study aims to assess Sri Lanka’s readiness for international carbon and bio-credit markets, benchmark its strategies against countries that have successfully implemented these schemes, identify existing gaps, and explore potential sectors for carbon trading and bio-credit adoption.

A case study will be used to explore the feasibility of claiming carbon credits for community-based ecosystem conservation efforts and the potential for earning bio-credits. The goal of this study is to provide insights to guide government policy and strengthen Sri Lanka’s participation in global markets.