Green Credit Programme: Greenwashing the Destruction of Forests

By Prakriti Srivastava and Prerna Singh Bindra 

The Forest Conservation Amendment Act 2023 (FCAA, 2023), or the Van (Sanrakshan Evam Samvardhan) Adhiniyam, as it is titled has fundamentally changed the forest governance regime of the country by diluting the definition of forests and excluding vast tracts of forests lands from legal protection, potentially seriously impacting our forests, and ecological security. A detailed analysis may be read here and here. 

The amendment also sets in motion a slew of rules and notifications, including the Green Credit Rules and the FCAA, 2023 rules, that further weaken forest governance by allowing large-scale diversion of forests for non-forestry activities that will be lethal for our natural ecosystems. 

The Green Initiative Programme and Rules 

The Green Initiative Programme vide S.O. 4458 (E) dated October 12, 2023, is purportedly effected with the objective of incentivising ‘environmental positive actions’ through market-based mechanism and to generate green credit, which shall be tradable. This needs to be read with its Rules, notified vide S.O. 884(E) dated 22/02/2024, according to which agencies can earn green credits through afforestation on lands under administrative control of the Forest Department. The green credits earned by the investing agencies are then traded as Compensatory Afforestation compliance for diverting notified and other Unclassed forests for non- forestry activities.

As we show in this article, the ‘Green’ Credit Rules, the seemingly positive rationale of the GCP, is nothing but greenwash aimed to incentivise the destruction of existing primary forests. It signals a move towards monetising and trading forests instead of their conservation; and a shift from the principle of ‘land-for-land’ in the case of forest diversions to ‘cash for (forest) land’.

Explainer: What is the Green Credit Programme & Rules 

As per the rules, the Forest Department shall identify degraded land parcels under its administration to be offered to any person or entity for earning green credits, which can then be traded in exchange for compliance of Compensatory Afforestation (CA) for forest diversion cases under the FCAA, 2023. 

A month after the FCAA, 2023 was enacted, the S.O. 4458 (E) Green Credit Programme (GCP) was issued on 12/10/2023 followed by the FCAA 2023 Rules GSR 869-E on 29/11/2023, which have both been integrated to produce SO 884 (E) dated 22/02/2024. 

This amalgamation of the GCP and the FCAA 2023 rules is lethal for our forests. 

• The Green Credit Rules (GCRs) lay out how green credits are earned by user agencies via afforestation of forest lands. Under the rules, the Forest Department will identify degraded land parcels of five hectares and above under their administrative control and management, and the Indian Council of Forestry Research and Education (ICFRE) – designated as administrator under the rules – will allot such lands to private agencies such as industries, companies, mining firms etc. for plantations. These include all open forest and scrub land, wasteland and catchment areas, which are forest lands and unique ecosystem entities in themselves. 
• The agency will then pay the Forest Department to afforest the land allotted to them. After being informed of completion of afforestation in two years, the Administrator of ICFRE issues a certificate to the user/funding agency of completion of the tree planting activity. A minimum of 1,100 trees per hectare needs to be planted with one tree being equated with one green credit. 
• The Green Credit generated can then be exchanged for meeting the compensatory afforestation compliance in case of diversion of forest land for non-forestry purposes under the FCAA, 2023.  

Violative of Supreme Court Orders 

Identification of forest land under the Green Credit Rules contravenes the Supreme Court’s WP202/96 landmark order of 12/12/1996, or the Godavarman order as it is commonly known, which envisages that all lands that are forests are to be protected as such and any diversion is subject to the approval of the Central Government. The SC in its interim order dated 19/02/2024 has directed that the principles elucidated in the 202/96 Godavarman order must be continued to be observed. Therefore, forest lands that were protected by the 202/96 Godavarman judgement would continue to be protected under the FCAA, 2023. These forest lands – even if degraded – cannot be used for the purpose of generating green credits as it would amount to treating them as ‘non-forest land’ for compensatory afforestation, which would be antithetical to the letter and spirit of the Hon’ble Court’s order.

Violative of the FCAA, 2023 

• Shockingly, the lands under the management and administrative control of the Forest Department parceled for afforestation for earning green credits may include Reserved Forests, Protected Forests, Community Forests etc., notified under the Indian Forest Act 1927 and/or its equivalent in the States, as the GCP Rules do not mention their exclusion. This is violative of even the FCAA, 2023, which does not envisage that notified forests can be used for compensatory afforestation in lieu of forest diversion. In fact, it contradicts the December 2023 guidelines under the amended Act, which say that the mandatory requirement/condition of CA for diversion of forest land is to “compensate the loss of 'land by land' and loss of 'trees by trees’”.
  The intent of this statement clearly is that the loss of forest land must be compensated by non-forest land and not by another notified/non-notified forest land as per the GCR. But in the case of green credits, diverted forest land will be compensated by money and not by non-forest land.

Impacts 

The Green Credit Rules will have highly damaging and irrevocable impacts as they facilitate destroying natural and diverse ecosystems. This programme monetises CA compliance through green credits, essentially doing away with the paradigm of replacing diverted forest land with non-forest land, and instead replaces diverted forest land with money from user agencies for afforestation on lands allotted for this purpose. This will accelerate the shrinking of forests, and potentially lead to their complete decimation. 

The mechanism to generate green credits through tree plantation will not contribute to an increase in forest cover and instead will be used to justify the diversion of forest land. In any case, trees do not and cannot replace forests as we explain further in the article. Forest lands will be diverted for non-forestry purposes and be compensated by plantation on lands that are already forests – notified forests, unclassed forests, and deemed forests, resulting in the rapid loss of forest land. 

This also lays to rest the goal of the National Forest Policy of one-third land in the plains and two-thirds in the hills being under forest area. With the decimation of forest lands, this target seems impossible to achieve. May we add that it is the MoEFCC, the author of the National Forest Policy, which has issued the Green Credit Programme and Rules, and thus contradicted its own policies! 

The GCRs pose a threat to vital and biodiversity-rich ecosystems

• All forest lands are not suitable for afforestation and therefore taking up plantations in such areas is ecologically disastrous. Grasslands, wetlands, deserts, scrub forests, and open forests are ecological entities and afforesting these will irrevocably alter their ecology; destroying vibrant ecosystems and the unique flora and fauna they support. The importance of such ecosystems is recognised globally. In India, they support a remarkable diversity of species, many of which are unique and endemic to the Indian subcontinent including the Critically Endangered Great Indian Bustard, Lesser Florican, wolves, and blackbucks, to name a few. Such ecosystems support the livelihoods of millions from pastoral and agro-pastoral communities across the country. 
• While the Green Credit rules position themselves as a market-based mechanism to achieve broader climate goals, what is not considered is that open forests, catchment areas and grasslands, which will be ‘traded’ and irrevocably altered, are effective carbon sinks. By some estimates, grasslands store  about 34 per cent of the terrestrial carbon stock and may even serve as more resilient carbon sinks! On the other hand, it is an established scientific fact that plantations and monocultures of the sort that afforestation programmes prefer are poor at sequestering carbon, and not as effective as natural ecosystems. 
  These neglected and mismanaged ecosystems need to be protected and restored. By issuing such an order, the MoEFCC not only goes against to its mandate of protecting forests but exposes its poor technical competence. 

Grasslands, wetlands, deserts, scrub forests, and open forests are ecological entities and afforesting these will irrevocably alter their ecology. Photo: Anish Andheria.

Lack of Clarity 

• The rules do not provide for next steps in case the plantations fail, which various reports indicate as a routine affair (see here and, here). Most plantations fail their purpose of greening and carbon uptake. There is no mention in the rules that if the plantation fails, will the green credits be revoked and the money returned to the funding agency or do they still keep the green credits? And, what happens if the user agency has already traded the green credits as CA compliance and the plantation fails? The rules lack clarity, providing room for their misuse in their ambiguity. 
  Further, two years is too short a time to declare a plantation successful and its purpose seems only to facilitate the user agency for faster Compensatory Afforestation compliance.

Compensatory Afforestation: A failure

• Besides having low success rates as discussed above, afforestation programmes are typically mismanaged, and translate to poor quality plantations predominantly of quick growing, usually exotic trees (to show results) with little ecological value.  Natural forests, which harbour a diverse mix of native tree species, are more reliable and effective for sequestering carbon than monocultures or low species tree plantations, which is usually the case in tree planting or afforestation exercises. As per the government’s own record, over half of all CA plantations in India during 2015-18 utilised no more than five tree species. A Western Ghats-based 2020 study found that natural evergreen forests store around 300 tonnes of carbon per hectare, substantially higher than plantations. In fact, the remarkably low contribution of plantations to carbon stock is recorded in Forest Survey of India reports – as per the 2021 report, India’s forests currently store about 2320 MT of carbon as above ground biomass with plantations contributing just about four per cent of this stock.
• Huge funds are wasted on CA despite the success rate of plantations and afforestation raised by Government agencies being abysmally low. The Central government alone has spent around Rs. 59,000 crore between 2009 and 2020 on compensatory afforestation by many agencies for raising failed plantations and afforestation schemes. 
• It must be pointed out that the government has sufficient funds (indeed a significant percentage of funds earmarked for afforestation lie unused) to regenerate these ecosystems, and does not require money from user agencies. The substantial CAMPA funds already available with the Government can be used for restoration and regeneration of ecosystems instead of building large, unnecessary, garish infrastructure and other such wasteful expenditure as has been mostly done as per various reports.  
• An Audit report on compensatory afforestation by the Comptroller and Auditor General of India tabled in September 2013 pointed out serious shortcomings in regulatory issues related to the diversion of forest land, abject failure to take up and complete sanctioned compensatory afforestation and unauthorised diversion of forest land in the case of mining and the attendant violation of the environmental regime. Shockingly, of the total area sanctioned for compensatory afforestation only 49 per cent of area had been taken up for CA.
• The MoEFCC again issued a modified guideline (F. No. HSM 12/24/2023-HSM (pt-2) Part (1) E-220847) on April 12, 2024 for preparation of cost estimates for eco-restoration of degraded forest lands under the Green Credits Programme, which does not insist on 1,100 trees being planted per hectare but exhorts eco-restoration for earning green credits. However, there is no clarity on how green credits will be earned by eco-restoration, further adding to the confusion.

An oil palm plantation in Mizoram. Natural forests, which harbour a diverse mix of native tree species, are more reliable and effective for sequestering carbon than monocultures or low species tree plantations. Photo:  T R Shankar Raman/CC-BY-SA 4.0.

The rules framed under the FCAA 2023 GSR 869 (E) issued on 29/11/2023 enable green credits to be used for CA compliance

The rule 14 (5) (i) made under the FCAA 2023 directs all user agencies to register with the Green Credit Programme so as to earn green credits for trading them for compensatory afforestation compliance. The MoEFCC is thus helping user agencies to find an easy route to fulfil CA compliance via cash-based green credits rather than obtaining lands to hand over to the Forest Department for CA compliance. Though there is no clarification on how such a compliance of Compensatory Afforestation will be met by earning/exchanging green credits. Put another way, the ratio of green credits that will be exchanged for each unit of CA land is not specified. It is probably kept opaque so as to facilitate diversions of forest lands on the sly without the scrutiny of the media and citizens of the country. This shows a clear connection between the Green Credit Rules and the FCAA 2023 rules and how both rules coordinate to facilitate user agencies for quick and smooth diversions of forest lands for non-forestry purposes.

The other ways the FCAA, its various rules and guidelines are geared to facilitate faster diversion of forests is further explained below. 

Loss of forest lands by illegal use of unclassed forests for compensatory afforestation compliance

FCAA 2023 Rules – GSR 869 Rule 13 (3) (a), (b), (c) and (d) and 13(4)

• Under the FCAA 2023 rules, if non-forest land is unavailable, compensatory afforestation can be undertaken on forest lands, which could be revenue forest lands (lands recorded as forest in Government records but not notified as forest under any law), deemed forests, unclassed forests, and other similar forests (zudpi forests, chhote-bare jhar ke jungle, jungle-jhari land, civil-soyam, orange forest lands etc.). These categories of forest lands were protected by the 202/96 Godavarman order and continue to be protected by the SC Order WP 1164/24 dated 19/02/2024. As per the Godavarman judgement, these forest lands should have been identified by the State Expert Committees (SECs) constituted pursuant to the same order and given statutory protection. Instead, MoEFCC and the State Forest Departments are now identifying these forest lands across the country and building a land bank for compensatory afforestation and facilitating diversion of notified forests to user agencies. 

It may be noted that MoEFCC had issued a letter (F.No. 5-1/2007 dated 18th July, 2007) in July 2007 categorically stating that zudpi jungles, and chote bade jahr ke jungle are deemed forest coming under the definition of deemed forests as per the WP 202/96 Godavarman judgement and cannot be considered as CA lands. 

However, the  MoEFCC undid this by a letter (2023  FC-11/118/2021-FC dated 13th June, 2023) in June that directed states that revenue lands/zudpi jungle/chhote/bade jhar ka jungle/jungle-jhari land/civil-soyam/orange lands, Arunachal Pradesh, Degraded Unclassed Forests, waste lands of Himachal Pradesh, etc. and all other such categories of forest lands not under management and/or administrative control of the State/UT Forest Department, on which the provisions of FC Act, 1980 are applicable, shall be considered for the purpose of compensatory afforestation without permission of the Supreme Court. 

The MoEFCC had correctly interpreted the 202/96 SC order, but then has disregarded this order through its subsequent June 2023 letter.  

Many of the categories of forests lands mentioned for example zudpi jungle, chhote jhar ka jungle, bade jhar ka jungle, jungle-jhari land are not “wastelands” or degraded forests but highly biodiverse ecosystems which host endangered wildlife, including species protected under Schedule I of the Wildlife (Protection) Act, 1972 such as wolves, pangolins, leopards, hyenas, fox and a host of reptiles and avifauna. Such forests also serve as vital corridors for tigers and bears, providing connectivity that is critical for their long-term survival. These may include ecosystems such as the Aravali mountains, tracts of the Thar desert or the Banni grasslands to name a few. 

Another damaging clause is the Rule 14(3) of the FCAA, 2023 (GSE 869 (E)) wherein, in hilly states where two-third areas are forested or a state in the plains with one-third area under forests, if diversion has to be done, CA can be raised in another state if both states consent. Simply put, diversion of forest lands in one state is compensated under CA in another state to facilitate diversions. This does not take into account the type of forests in the state where the diversion is taking place; nor provide for any scientific scrutiny or audit. A glaring example of this is the proposed diversion of the biodiverse, tropical forests of Nicobar Islands and CA being done in the Aravallis in Haryana, where the forest type is totally different, and which may well end up financing a “curated safari” – in other words a large zoo, as per this report. The loss of forest in one geographical area cannot be “compensated” by afforestation in another area/state because it will still cause loss and destruction of native and resident wildlife. Also, it also does not consider if the forest to be diverted is a wildlife corridor, watershed area, contiguous to Protected Areas which are site specific, and cannot be replicated or compensated by plantations in far-off areas.
All that is considered is the speedy provision of a land bank to facilitate the user agency in forest diversions.

A Double Whammy for India’s forests

The use of forest land for CA and generating green credits based on plantations will cause destruction twice over of India’s natural forests: first, diverting notified forest lands for non-forest purposes, and second, losing non-notified forest land to plantations as CA while ignoring the poor ecological value of plantations in comparison to biodiverse forests. 
Clearly, the ominous agenda here is to prepare a land bank for the user agency for CA compliance in lieu of obtaining diversions. 
Instead of the government identifying and notifying such lands and ensuring restoration of the ecosystem with its original ecological values, the Government is creating a land bank to easily divert our notified forests and accept blood money from the user agency for giving back our own forests to us! 

In conclusion, the Green Credit Programme and Green Credit Rules must be withdrawn if we are to save our natural ecosystems and not use our notified and other forests to propel forest diversions. Using unclassed forests as per the FCAA, 2023 rules should not be allowed, and the whole FCAA 2023, repealed. All unclassed and other forests as per the 202/96 Godavarman order as well as the Lafarge order of 2011 should be identified on ground, notified as Reserved/Protected Forests, and provisions should be made to ensure their conservation for posterity. 

The case challenging the constitutionality of the FCAA (read here and here) is expected to be heard in the Supreme Court soon, and we are confident that the judiciary will uphold and protect our forests and the ecological security of our country.

A protest against the Tipaimukh dam in Manipur. Photo: International Rivers/CC-BY-NC-SA 2.0.

Further reading

• A letter has also been written by the Constitution Conduct Group to withdraw these Green Credit Rules, which may be read here. 
• Also read X thread on the GCRs here.

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Prakriti Srivastava is an IFS officer. She retired as PCCF, Kerala and has also served as DIG (Wildlife) in the Ministry of Environment and Forests.   

Prerna Singh Bindra is Former Member, National Board for Wildlife, an author, and is currently a Ph.D. scholar in the University of Cambridge.