Maarg Manthan · Topic 19.8

Compensatory Afforestation Fund Management and Planning Authority (CAMPA)

Environment & Ecology › Environmental Institutions and Schemes in India · Topic 19.8

The Compensatory Afforestation Fund Management and Planning Authority (CAMPA) is the body that manages money paid by project developers for forest land taken for non-forest uses. Under the Forest (Conservation) Act, 1980, when forest land is diverted for a project such as a mine, dam or road, the user agency must pay for compensatory afforestation on equal non-forest land (or twice the area of degraded forest land) and the Net Present Value (NPV) of the diverted forest, a figure set by the Supreme Court, to reflect lost ecological services. Before 2016 these funds were held by an ad hoc CAMPA set up on the Supreme Court's orders in the Godavarman case (2002 and 2009), and by 2016 they held tens of thousands of crores of rupees that were not being used. The Compensatory Afforestation Fund Act, 2016 and the Rules of 2018 created the National Compensatory Afforestation Fund and State Compensatory Afforestation Funds, along with the National CAMPA Authority, chaired by the Union Environment Minister, and State CAMPA Authorities chaired by Chief Ministers. About Rs 54,000 crore was transferred to the national and state funds in 2019, of which 90 percent is passed to states and 10 percent kept by the Centre. The money is used for afforestation, assisted natural regeneration, soil and water conservation, wildlife management, relocation of villages from protected areas, forest fire prevention and infrastructure, with Annual Plans of Operations. Critics point to slow spending, weak survival of plantations and diversion for non-forest uses.

5 min read · UPSC Prelims · Environment & Ecology · Environmental Institutions and Schemes in India

At a Glance

Law CAF Act, 2016
Payments Compensatory afforestation and NPV
Earlier body Ad hoc CAMPA
Chair Environment Minister (National)
Split 90 percent to states
Exam link UPSC Prelims, Environment & Ecology: Environmental Institutions and Schemes in India

Where Does It Fit?

This topic follows the National Board for Wildlife…">National Wildlife Action Plan and presents the financial mechanism for forests, which funds many of the programmes discussed earlier. Previous topic: National Wildlife Action Plan. Next topic: Joint Forest Management and Social Forestry.

How Does CAMPA Work?

Element	Details
Principle	When forest land is diverted, the user pays for forestry on other land and for lost forest value
Compensatory afforestation	Planted on equal non-forest land, or twice the area of degraded forest land if no non-forest land exists
Net Present Value	A one-time payment for the ecological services of the forest lost, with rates set by the Supreme Court and reviewed by a committee
Ad hoc CAMPA	Set up by the Supreme Court in 2002 and 2009 to receive funds
CAF Act 2016	Created the National CAF and State CAFs and set up authorities; Rules in 2018
National CAMPA Authority	Chaired by the Environment Minister; guides use of the fund
State CAMPA	Chaired by the Chief Minister; prepares Annual Plans of Operations

How Is the Money Used and What Are the Issues?

Transfer: about Rs 54,000 crore moved to national and state funds in 2019
Split: 90 percent to state funds and 10 percent to the national fund
Uses: afforestation, assisted natural regeneration, forest protection, wildlife management, soil and water conservation, village relocation, fire control
Annual Plans: states prepare and get approval
Monitoring: geo-tagging and third-party evaluation
Issues: slow spending, low survival of plantations, planting on poor land
Diversion: concern about use of funds for non-conservation purposes like roads and buildings
Local involvement: funds can be used through village forest committees

What Else Should You Remember?

Godavarman case: T N Godavarman Thirumulpad v Union of India, a long-running case that shaped forest law
Supreme Court 2002: ordered the creation of ad hoc CAMPA
Supreme Court 2009: approved the CAMPA guidelines, with funds for compensatory afforestation
Net Present Value: also paid for Forest Conservation Act clearance, with rates set according to forest type and density
Forest Conservation Act: now the Van (Sanrakshan Evam Samvardhan) Adhiniyam, 2023
CAF Rules 2018: rules for the use of funds, interest and accounts
Interest: earned on the fund also used
Nature of fund: non-lapsable fund in the Public Account of India
Steering committee: guides the National Authority
Executive committee: chaired by the Director General of Forests
Governing body: includes experts and officials
Annual Plan of Operations: APO is the yearly work plan
CAG audit: has pointed out misuse and delays
2023 Act: changed the scope of compensatory afforestation for some projects
Survival rates: monitoring shows variable plantation survival
Assisted natural regeneration: a cheaper method of restoring forest
Wildlife work: funds are used for habitat improvement
Fire protection: fire lines and watch towers
Relocation: voluntary relocation of villagers from protected areas
Link to previous: see National Wildlife Action Plan
Link to next: see Joint Forest Management and Social Forestry
Link to forest programmes: see Government Programmes for Forest Conservation
Caution: fund balances, rates and rules change, so check the PARIVESH and CAMPA portals
Exam hint: remember 2016 Act, 2018 Rules, Godavarman, NPV and the 90:10 split
Legal basis: Compensatory Afforestation Fund Act, 2016 and Rules of 2018 give a statutory basis, replacing the court-based arrangement
Why ad hoc CAMPA was criticised: funds idled for years without proper use or accountability
Transparency: online portal shows project data and fund use
Community role: village forest committees can implement CAMPA works for wages and livelihoods
Link with forest clearance: the user agency must pay before final forest clearance is given

Why Does It Matter for the Exam?

Law: 2016
Earlier: Ad hoc CAMPA
Split: 90:10
Current affairs link: CAMPA spending
Common errors: confusing NPV with compensatory afforestation

As an analytical point, CAMPA tries to make developers pay for the forests they take, but replacing a natural forest with plantations elsewhere is not equal. Fast spending, careful site selection and independent monitoring are needed so the fund restores real forest and not just paper targets.

Why Is This Topic Important?

Principle Pay for loss
Fund CAF Act
Test Survival

What Came Next?

The next topic covers Joint Forest Management and social forestry. Next topic: Joint Forest Management and Social Forestry.

Key People and Terms

CAMPA Compensatory Afforestation Fund Management and Planning Authority
NPV Net Present Value
CAF Compensatory Afforestation Fund
APO Annual Plan of Operations
ANR Assisted natural regeneration
User agency Project developer

Exam Corner

Points to Remember

CAF Act: 2016.
Rules: 2018.
National Authority chair: Environment Minister.
90:10 split states to Centre.
Origin: Godavarman case.

Do Not Confuse With

NPV and compensatory afforestation Payment for lost services versus planting on other land
Ad hoc CAMPA and statutory CAMPA Court-created versus Act-based body
National and State CAMPA Central versus state authority

Memory Hook

Pay for the forest you take: plant elsewhere, add the NPV, ninety to the States.

Mains Angle

Questions ask for the Act, NPV and split. These points help.

Principle Pay
Law 2016
Gaps Spending

A Question You May Face

An original practice question, not a past paper question.

“Explain how the Compensatory Afforestation Fund and CAMPA work and discuss the issues in their implementation.”

How to Answer

Principle Pay for loss.
History Godavarman.
Act 2016.
Issues Spending.

GS Relevance

Prelims: Act, NPV, fund split. GS Paper 3: forest finance and compensation.

Frequently Asked Questions

What is CAMPA?

CAMPA, the Compensatory Afforestation Fund Management and Planning Authority, manages money paid by developers who take forest land for projects. The funds, for compensatory afforestation and the Net Present Value of lost forest, are used for afforestation, regeneration, wildlife management and protection, under the Compensatory Afforestation Fund Act, 2016.

What is Net Present Value in forest clearance?

Net Present Value is a one-time payment by a project developer that reflects the present value of the ecological services, such as timber, carbon, water and biodiversity, lost when forest land is diverted. The rates, set on the Supreme Court's direction, vary with forest type and density, and the money goes to the compensatory afforestation fund.

Why was the Compensatory Afforestation Fund Act, 2016 passed?

Funds collected from project developers had piled up with an ad hoc CAMPA created by the Supreme Court and were not being used well. The 2016 Act created statutory national and state funds and authorities to ensure transparent, timely use of the money for afforestation and conservation, with the bulk of it going to states.

How is the CAF money shared and used?

Of the amount collected, 90 percent goes to the State Compensatory Afforestation Funds and 10 percent to the National fund. The money is used for planting trees, assisted natural regeneration, soil and water conservation, wildlife habitat improvement, forest protection, fire control and voluntary relocation of villages from protected areas, under approved annual plans.

What are the main criticisms of CAMPA?

Critics say that funds are spent slowly, plantations often fail or are made on poor land, compensation does not replace natural forest, local communities have limited say, and some funds have been used for buildings and vehicles. Audits by the CAG have noted delays and misuse, so monitoring and local participation are needed.

PYQ Practice — Statement Analysis

1 The CAF Act was passed in 2016.

True

With Rules in 2018.

2 The National CAMPA is chaired by the Prime Minister.

False

By the Environment Minister.

3 NPV reflects lost ecological services.