In order to participate in the Kyoto Protocol CDM process for generating Certified Emission Reduction (CER) the government has set up a two tier Designated National Authority (DNA) through a government Notification on 13-10-2003. The lower tier, located at the Ministry of Environment and Forest (MoEF), is the secretariat or operational body of the DNA. It is performing all CDM related activities including giving preliminary approval of CDM projects through the CDM Committee. The upper tier, known as the CDM Board, gives the final endorsement of the approved projects. The Principal Secretary to the Prime Minister is heading the CDM Board. Since the Principal Secretary has jurisdiction over all secretaries of different ministries of the government, it is expected inter-ministerial coordination will be easily achieved.

The main task of the DNA is to approve CDM projects, which can eventually be registered by the CDM Executive Board of the UNFCCC. As per the Modalities and Procedures of CDM, approval by the DNA is mandatory before project validation by any Designated Operational Entity (DoE) and subsequent registration by the Executive Board of the CDM.

Apart from establishment of DNA, the government has also established national procedures for evaluation and approval of CDM projects, developed sustainable development criteria for the evaluation of CDM projects and finalized the CDM strategy.