Australia's Climate Change Minister Penny Wong said on Thursday the government remained committed to its carbon trading plans, despite growing calls for the scheme to be reconsidered or replaced with a carbon tax.

Australia has promised to introduce carbon trading in July 2010 as part of its efforts to fight global warming and cut greenhouse gas emissions by at least 5 percent by 2020.

Some economists, opposition lawmakers and businesses have stepped up their criticism of the scheme after the government last week announced a new inquiry into the plan, but Wong said carbon trading would go ahead.

"The reality is we have designed a scheme that gets the balance right," Wong told Australian radio on Thursday, adding the impact of the global downturn and slowing economic growth in Australia were already taken into account with the plan.

"We were very conscious of the existing and likely future economic situation as we were designing this scheme."

Carbon traders and analysts has said the inquiry comes at a time when doubts were being raised about how much money the government would raise through its carbon pollution reduction (CPRS) scheme to fund the development of cleaner energy.

Under the plan, polluters will be able to offset emissions by importing unlimited certified emission reduction (CER) credits generated by U.N.-backed clean energy projects in developing countries.

The proposal effectively links the price of carbon internationally to the price of Australian emission units (AEU).

The decision to set up a new parliamentary inquiry into carbon trading prompted the Australian Greens party to raise concerns the government may be backtracking on its commitment to carbon trading.

Major resource companies have regularly warned they may be forced to close or move some operations offshore under the world's broadest carbon trade scheme, which will cover 75 percent of the nation's emissions and 1,000 of Australia's biggest firms.

Major exporting polluters, including iron ore and aluminium producers BHP Billiton, Alcoa and Rio Tinto, and liquefied natural gas (LNG) producers Chevron and Woodside Petroleum, will get significant exemptions for emissions.

Wong said the government had already set aside more than A$9 billion ($5.7 billion) in assistance for industry until 2012 to help reduce the economic impact of the scheme.

The conservative opposition parties in Australia want the scheme delayed for a year, but have yet to spell out a final stance on carbon trade laws, which are due to be introduced in Australia's parliament in May.

Wong, however, said the carbon trade system would help Australia reach its target to cut greenhouse emissions by 5 percent by 2020, or deeper if there is an international agreement for stronger action.

"This is an issue of what is the best policy design for Australia in the short and the long term," Wong said.

"The fact is a market mechanism is the cheapest, most cost effective way of reducing Australia's emissions. It also ensures we can achieve an environmental target, which a carbon tax does not," she said.

Australia, the world's biggest coal exporter and a growing supplier of LNG, accounts for 1.5 percent of global carbon emissions but is one of the highest per-capita polluters, with 80 percent of electricity from coal-fired power stations.