Carbon dioxide from burning fuels is a key player in climate change. Various international agreements, like the Kyoto Protocol, set rules to control greenhouse gas emissions. These agreements led to the creation of a global carbon trading market where companies can trade carbon credits. The paper discusses how India is involved in these agreements and the legal steps it takes to support carbon trading, like the National Action Plan and state-level programs. India also has laws like the Energy Conservation Act and environmental protection acts to help regulate carbon trading. The paper suggests that to fully support and manage the carbon trading market in India, a new law covering all related issues should be put in place.