Q63. Consider the following statements:
Statement-I: Carbon markets are likely to be one of the most widespread tools in the fight against climate change
Statement-II: Carbon markets transfer resources from the private sector to the State.
Which one of the following is correct in respect of the above statements?
1. Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I
2. Both Statement-I and Statement-II are correct and Statement-II is not the correct explanation for Statement-I
3. Statement-I is correct but Statement-II is incorrect
4. Statement-I is incorrect but Statement-II is correct
Question from UPSC Prelims 2023 GS Paper
Explanation :
Correct Answer – 2. Both Statement-I and Statement-II are correct and Statement-II is not the correct explanation for Statement-I
Carbon Markets and Climate Change
Statement-I: Carbon markets are indeed expected to play a significant role in the fight against climate change. They provide a mechanism for countries and companies to trade carbon emissions allowances, incentivizing lower-emission activities and investments.
Statement-II: Carbon market facilitate the trading of carbon allowances between various entities, including private companies, governments, and individuals. The primary goal of carbon markets is to reduce overall emissions, not to generate revenue for the state.