Compensatory Afforestation Fund

(Practice Questions:

Q.1. Highlight the necessary elements of the concept of ‘compensatory afforestation’. Also comment on the existing legal framework in this regard in India. – 250 words.

Q.2. Do you think the Compensatory Afforestation Act, 2016 adequately addresses the concerns of the village and tribal population of India? – 150 words.)

(Why in news recently: The recently released Compensatory Afforestation Fund Rules, 2018 under the Compensatory Afforestation Act, 2016 has stroked a controversy.)

What is compensatory afforestation?

Compensatory Afforestation (CA) refers to afforestation and regeneration activities carried out as a way of compensating for forest land diverted to non-forest purposes. CA is one of the most important conditions stipulated by the Central Government while approving proposals for de-reservation or diversion of forest land for non-forest use.

Elements of Schemes for Compensatory Afforestation:
The scheme for compensatory afforestation should contain the following details:-

  • Details of equivalent non-forest or degraded forest land identified for raising compensatory afforestation.
  • Delineation of proposed area on a suitable map.
  • Agency responsible for afforestation.
  • Details of work schedule proposed for compensatory afforestation.
  • Cost structure of plantation, provision of funds and the mechanism to ensure that the funds will be utilised for raising afforestation.
  • Details of proposed monitoring mechanism.

Source: Arthapedia

What is the Compensatory Afforestation Fund (CAF) Act, 2016?

The CAF Act was passed with an aim to restore forest cover in the country, which was lost due to diversion of forest land for non-forest purposes like mining and industrial use. The CAF Act, 2016 has the provision for creating a national fund with contributions from user agencies—any person, organisation, company or department of the Central Government or state government making a request for diversion or de-notification of forest land for non-forest purpose. According to the Act, the fund will be used for “compensatory afforestation, additional compensatory afforestation, penal compensatory afforestation, net present value, catchment area treatment plan or any money for compliance of conditions stipulated by the Central Government while according approval under the provisions of the Forest (Conservation) Act, 1980″.

Advantages of the CAF Act – the CAF Act will boost the efforts towards restoration and enhancement of forest wealth, enhance bio-richness, water availability and secure ecological security of the country. This effort will help in creating the additional carbon sink to meet the nation’s Intended Nationally Determined Contribution (INDC) of  2.5 to 3 billion tonnes of carbon dioxide equivalent through additional forest and tree cover by the year 2030.

Source: Down to Earth and PIB

What is the Compensatory Afforestation Fund (CAF)?

The CAF is a nationally constituted authority under the CAF Act that presides over a corpus of Rs. 66,000 crore. This is money paid by developers who have razed forest land for their construction projects, and the idea is that such land destroyed needs to be made good by regenerating forest elsewhere on non-forest land. The amount to be paid depends on the economic value of the goods and services that the razed forest would have provided. These include timber, bamboo, firewood, carbon sequestration, soil conservation, water recharge, and seed dispersal. Industrialists pay this money and this is eventually transferred to the States concerned to carry out afforestation. Until recently, a Compensatory Afforestation Fund Management and Planning Authority (CAMPA) was in charge of the funds. However, the CAF Act 2016 establishes an independent authority to execute the fund.

Source: PRS and The Hindu

What are the concerns with the recently released CAF Rules?

The CAF rules under the CAF Acts have been recently notified (i.e. on August 10, 2018) and various concerns have been raised in respect of the same.

It has  been alleged that the CAF Rules “undermined” several aspects of the Forest Rights Act (FRA) and the Panchayats (Extension to Scheduled Areas) Act (PESA). In the current form, they significantly reduced the authority of the gram sabhas in having a say in their local compensatory afforestation projects and reduced them to the role of “consultants”. Much power instead was vested with the State-level forest bureaucracy. The gram sabhas were put on the same footing as panchayats; consequently there would be great control exerted by the State authorities in the disbursal of the fund. The provisions laid out in the rules limit compliance with the FRA only to those areas where rights holders have been formally recognised.

Source: The Hindu

How is the sum to be paid decided:

The sum to be paid under ‘compensatory afforestation’ is quantified on the basis of the concept of ‘net present value’ (NPV). The Supreme Court of India defined the NPV to be “the present value of net cash flow from a project, discounted by the cost of capital“. In simpler terms, NPV is a monetised value of forest land to be paid by the user agency to compensate for the loss of tangible and intangible benefits flowing from such lands.

Issues with NPV – 

Quantum of NPV is too less – At present, the NPV, calculated by a panel of experts is anywhere between Rs. 5 and Rs. 11 lakhs which is too less when compared to the loss faced by the environment when forests are razed.

Forest dwellers are not consulted in the NPV fixation process – Forest dwellers need to be consulted in the NPV fixation process as they tend to lose the most in cases where forests are replaced with development project.

Source: Times of India

Other Issues:

Non-availability of non-forest land – The main difficulty has been the non-availability of non-forest land for afforestation. The law says the land selected should preferably be contiguous to the forest being diverted, so that it is easier for forest officials to manage it. But in case that is not possible, land in any other part of the state can be used for the purpose. If no suitable non-forest land is found, degraded forests can be chosen for afforestation, but in that case, twice the area of diverted forest has to be afforested. Still, there is difficulty in finding land, especially in smaller states, and in heavily forested ones like Chhattisgarh.

Purpose for the use of money – The fund was envisaged to be used only for “compensatory” afforestation, but the Bill before Parliament has expanded the list of works that this money can be utilised for, and includes the general afforestation programme run through the Green India Mission. Critics say this will take the focus away from the prime objective of compensating for the forest cover lost to industrial or infrastructure development.

Source: The Indian Express

Categories: POINT IAS

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