Experts See Red With Green Credit Gamble

While the government frames this as a necessary step toward meeting national greening targets, the policy change raises critical questions about the definition of a forest and who has the right to manage it. For the average citizen, this move could influence everything from local groundwater levels to the integrity of India’s last remaining wilderness areas.

The Policy Shift: Reclassifying Restoration

Under the new directive issued in early 2026, private entities are now permitted to lease forest land categorised as “degraded” to carry out plantations for commercial benefit. Crucially, the government has reclassified these activities as “forestry.” This technical change is significant; it allows non-government entities to bypass the heavy Net Present Value (NPV) payments and penalties usually required when forest land is diverted for non-forestry purposes.

The shift is designed to align with India’s Green Credit Scheme. This controversial programme allows companies to generate green credits through tree planting, which can then be traded or used to meet corporate social responsibility (CSR) and environmental compliance mandates. Critics, however, argue that this creates a pay-to-pollute loophole, where the physical restoration of one area justifies industrial damage elsewhere. The Ministry of Environment, Forest and Climate Change was contacted for comment regarding the criteria for ‘degraded’ land and the protection of tribal rights under this new directive. As of the time of publication, the offices of the Director General of Forests and the Assistant Director General of Forests had not responded to multiple email inquiries.

The “Landlord” Bureaucracy

For long-time observers of India’s environmental history, this move signals a return to a top-down management style. Shankar Gopalakrishnan, Campaign for Survival and Dignity, a national federation of Indian Adivasi and forest-dweller organizations advocating for land rights, primarily through the enforcement of the Forest Rights Act (FRA) of 2006, views the directive as a strengthening of the “bureaucrat-corporate partnership.”

“The Forest Department has always treated the forest as its private property, acting less like a guardian and more like a landlord,” Gopalakrishnan says. “This policy is just one more effort to treat the land as a revenue-generating asset, where the government can make deals with whoever it likes to extract profit.”

Gopalakrishnan emphasises that forests are not merely blank slates for revenue but territories where people, wildlife, and ecology coexist. He argues that by treating forest land as a leasable commodity, the government risks creating a new set of vested interests that view local communities and their legal rights as obstacles to be removed rather than partners in conservation.

Ecological Value vs. Commercial Utility

The debate often hinges on a fundamental misunderstanding of what a forest actually is. To the Ministry, reaching 33% canopy cover is the primary goal. To an ecologist, a forest is a complex web of native species, while a plantation is often a biological desert.

Commercial plantations typically favour fast-growing, low-rotation crops like eucalyptus or acacia. While these species increase green cover on a satellite map, they can be devastating to local hydrology. Eucalyptus, for instance, is notorious for its high-water consumption, which can lower the water table and dry up local wells used by nearby villages.

“By definition, a monocultural plantation is not a substitute for a real forest,” Gopalakrishnan notes. “It lacks the ecological value of a natural ecosystem. In fact, it can be harmful to the water table, to local wildlife, and to other environmental aspects.”

Efficiency and the Private Sector

Despite concerns, some see potential. Vikrant Tongad, an environmentalist and activist, suggests the private sector might bring efficiency that the government lacks. He points to degraded forest patches around urban centres like Greater Noida that currently sit as dead zones due to bureaucratic hurdles. “If a private organisation uses native species and follows the right thinking, perhaps it could actually improve our forests,” Tongad observes. However, he remains deeply sceptical of the commercial focus.

The Common Land Alternative

Tongad raises a pivotal question regarding the sequence of land use: Why start with forest land at all? He argues that if the goal is commercial plantation, the government should look toward India’s vast “common lands” first.

“Forest land is reserved for forest purposes,” Tongad asserts. “If you want to look for land opportunities for commercial plantations, you should look at the land of the Gram Sabha. There is a massive amount of vacant common land in India that is already open for such use. We should start there.” Tongad believes the decision to leapfrog over vacant community lands to target reserved forests is a worrying development. He emphasises that if commercial interests must be served, they should be directed toward these vacant common lands rather than encroaching on the legal and ecological sanctity of protected forests.

The Legal and Social Road

Beyond the environment, the policy faces a legal challenge. India’s Forest Rights Act (FRA) of 2006 recognises the customary rights of forest dwellers. Any lease granted without the consent of the local Gram Sabha could be deemed illegal. By inviting private entities into forest lands without clarifying community rights, the government may be inviting decades of litigation. The success of this directive will depend entirely on whether the government prioritises ecological integrity over revenue, and democratic governance over corporate convenience.