Financing of Wastelands Afforestation in India

Abstract

India has vast tracts of wastelands, which have been lying barren for ages. Most such lands are physically suitable for growing trees and thus could be put to socially productive uses. However although economically viable afforestation requires massive initial investment, generally beyond the means of the landowers. Also government budgetary allocations do not cover current needs. In this situation , institutional credit is required. The National Bank for Agriculture and Rural Development (NABARD) of India has recognized this need and has devised a number of different schemes to provide refinance facilities to individuals and organizations. Although the number of forestry schemes refinanced by NABARD has increased rapidly in the past, they currently constitute only about 1% of the total number of loans sactioned and only about 2% of NABARD's cumulative loan disbursement to date. In fact, since 1992, the share of afforestation schemes has declined. A number of factors have been identifi...