Environmental experts, however, warn that the move could weaken safeguards for forest conservation.
Prakriti Srivastava, former principal chief conservator of forests in Kerala, said waiving NPV and compensatory afforestation would result in a loss of conservation funding and forest land.
“Under the earlier provisions, leasing out forest land was considered a non-forestry activity, for which payment of NPV and compliance with compensatory afforestation were mandatory,” she said. “With these requirements now eased, private entities stand to benefit by using forest land for plantations and earning profits without corresponding obligations for environmental protection.”
Srivastava said the amendment places responsibility on state governments to create mechanisms to regulate the scheme but raises questions about accountability. “Who will decide the framework, and how will environmental protections be ensured,” she asked.
The policy shift has revived a debate dating back more than three decades, as reported by (DTE), when proposals were made to lease large tracts of degraded forest land to private companies to meet India’s growing demand for paper and timber.
At the time, a plan to lease around 2.5 million hectares of degraded forest land for 30 years — with provisions for renewal — was placed before the Cabinet Committee on Economic Affairs. Private industry groups supported the move, arguing it would boost plantation forestry and reduce imports.
Environmentalists and tribal rights advocates opposed it, warning that large-scale commercial plantations would threaten forest-dependent livelihoods, village commons and the country’s ecological security.
Y Giri Rao, executive director of the Odisha-based non-governmental organisation Vasundhara, said the current amendment presents both opportunities and risks. “The policy supports restoration by exempting sustainable plantations from compensatory afforestation and NPV, potentially accelerating regeneration on degraded forest land under state oversight,” he said. “But risks include excessive leasing if DPRs lack rigour, monoculture plantations displacing native biodiversity, or weak supervision leading to degradation rather than enhancement.”
Rao added that the impact on tribal and forest-dwelling communities would depend heavily on implementation. Easier leasing could create livelihood opportunities through revenue sharing from timber or non-timber forest products, he said, but only if states ensure community participation in line with the Forest Rights Act of 2006.
“The downsides could include shrinking village commons, displacement from leased areas, restricted access to minor forest produce or grazing, and exclusion if agreements favour external entities without Gram Sabha consent,” he told DTE.
Giri clarified that what the ministry is stating is that much of the degraded forest land is under the occupation of local communities. “Without recognising these occupations under the Forest Rights Act (FRA), this could create significant problems,” he said.
Srivastava compared the amendment to the government’s Green Credit Programme, introduced in October 2023, which allows private entities to undertake tree plantations on identified degraded land in exchange for tradeable green credits.
Touted by the government as a market-based mechanism to increase green cover, the programme has also drawn criticism from environmental groups, who argue that it prioritises ease of business over ecological integrity and community rights.
