‘Green Credit Scheme’


Panel approves scheme to ‘trade’ in forests

      WHY IN NEWS:

It allows Forest Dept. to outsource reforesting to non-government agencies

SYLLABUS COVERED: GS 3:Forests:Schemes


For PRELIMS ‘Green Credit Scheme’ is important ! Note down the features and these can be part of any mcq.

For MAINS role of centre and state reagarding forest land should be more clear .


The Forest Advisory Committee, an apex body tasked with adjudicating requests by the industry to raze forest land for commercial ends, has approved a scheme that could allow “forests” to be traded as a commodity. If implemented, it allows the Forest Department to outsource one of its responsibilities of reforesting to non-government agencies.

Forest Advisory Committee 

  • States, having well established forest departments, are in a better position, rather than Union Environment Ministry, to understand their own forests and needs, and should frame criteria for their forests; criteria so finalised by a State need not be subject to approval by Union Environment Ministry.
  • The freedom to define land, not already classified as forests by the Centre or State records, as forest has been the prerogative of the States since 1996 and stems from a Supreme Court order.


  • Industries have often complained that they find it hard to acquire appropriate non-forest land, which has to be contiguous to existing forest.
  • Nearly ₹50,000 crore had been collected by the Centre over decades, but the funds were lying unspent because States were not spending the money on regrowing forests.
  • The Supreme Court intervened, a new law came about with rules for how this fund was to be administered.
  • About ₹47,000 crore had been disbursed to States until August, but it has barely led to any rejuvenation of forests.


  • Industry needs to make good the loss of forest by finding appropriate non-forest land — equal to that which would be razed.
  • It also must pay the State Forest Department the current economic equivalent — called Net Present Value — of the forest land.
  • It’s then the department’s responsibility to grow appropriate vegetation that, over time, would grow into forests.

‘Green Credit Scheme’ 

The proposed ‘Green Credit Scheme’ allows agencies — they could be private companies, village forest communities — to identify land and begin growing plantations.

After three years, they would be eligible to be considered as compensatory forest land if they met the Department’s criteria.


  • Under the Green Credit Scheme, the Forest Department is allowed to [wc_highlight color=”yellow” class=””]outsource to non-government/private agencies. [/wc_highlight]
  • The scheme is in line with the Green India Mission that aims to achieve its target of 2.523 billion tonnes of carbon by 2020-30. It involves adding 30 million hectares in addition to an existing forest.
  • Green Credit Scheme allows agencies they could be private companies, village forest communities to identify land and begin growing plantations.
  • If they met the forest department criteria, after three years, they will be eligible to consider compensatory forest land.
  • Industry need forest land could then approach the agency and pay it for parcels of such forested land, and this will be transferred to the Forest Department and be recorded as forest land.

      IASbhai WINDUP: 

The scheme will encourage plantation by individuals outside the traditional forest area and help in meeting international commitments, such as sustainable development goals (SDGs) and nationally determined contributions.

On other hand critics say that it creates problems of privatizing multi-use forest areas as monoculture plantation plots. Forests are treated as a mere commodity without any social or ecological character.

      SOURCES:  THE HINDU | Green Credit Scheme

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