Lok Sabha passes Compensatory Afforestation Fund Bill, 2015


Posted on:05 May 2016 09:28:07

Lok Sabha passes Compensatory Afforestation Fund Bill, 2015
05 May 2016 Current Affairs: The Lok Sabha passed the Compensatory Afforestation Fund Bill, 2015 for the establishment of funds under the public accounts of Centre and each State towards compensatory afforestation. It also provides for additional afforestation and penal compensatory afforestation to regulate collected funds.

Features of the bill  : It seeks to establish the National Compensatory Afforestation Fund under the Public Account of India, and a State Compensatory Afforestation Fund under the Public Account of each state. The payments into the funds include compensatory afforestation, net present value of forest (NPV), and any project specific payments. The National Fund will get 10% of funds collected and the remaining 90% will go to respective State Fund. The collected funds will be utilised for afforestation, regeneration of forest ecosystem, wild life protection and forest related infrastructure development. The bill also seeks to establish National and State Compensatory Afforestation Fund Management and Planning Authorities to manage the funds. The determination of NPV will be delegated to an expert committee constituted by the central government

The Forest (Conservation) Act, 1980 (FCA) governs diversion or use of forest land for non-forest purposes such as industrial or infrastructure projects. A company diverting forest land must provide alternative land for taking up compensatory afforestation. For the afforestation purpose, the company should pay for planting new trees in the alternative land provided to the state. The loss of forest ecosystem must also be compensated by paying for (NPV). In 2002, the Supreme Court of India observed that collected funds for afforestation were underutilised by the states and it ordered for centrally pooling of funds under ad hoc Compensatory Afforestation Fund. The court had set up the ad hoc National Compensatory Afforestation Fund Management and Planning Authority (National CAMPA) to manage the Fund. In 2009, states also had set up State CAMPAs that receive 10% of funds form National CAMPA to use for afforestation and forest conservation. However, in 2013, a CAG report identified that the funds continued to be underutilised.


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