India intends to introduce carbon markets as an instrument to help decarbonise its industrial sector. This article analyses the proposed structure of the Indian carbon market, and identifies three key elements that would need to be designed well for the markets to be effective. These are the institutional mechanism governing the markets, the mechanism for setting the emission intensity targets, and the mechanism for enforcement of the targets. If these elements are not carefully thought through, then the markets may not deliver on their promise. The article was published in the June 2024 issue of The India Forum. A version of the article can be downloaded from this page.