Investing in degraded forest land for the health of our economic system

Source: Down to Earth

Relevance: Importance of effective management of land resources.

Synopsis: Arresting forest land degradation can help India achieve its SDG targets in a most cost-effective manner. Significance of a healthy forest ecosystem and its benefits.


Speaking at the high-level virtual dialogue on desertification, land degradation and drought organised by the United Nations (UN) General Assembly in New York, Indian PM said that India is on track to restore 26 million hectares (mha) of degraded land in order to achieve land degradation neutrality by 2030.

Managing land resources is crucial to not only achieving climate targets by way of carbon sequestration and other pathways, but also in securing the United Nations-mandated sustainable development goals (SDG) equitably.

From this perspective, it is necessary to understand the multiple benefits that are associated with arresting land degradation and desertification, along with their associated economics.

Impact of forest land degradation

Globally, almost 30% of the total land area is degraded and nearly 3 billion people live on degraded land

  • The economic cost of land degradation is approximately $300 billion annually (Rs 22 lakh crore).
  • Impact on agricultural productivity: Agricultural productivity is heavily dependent on soil fertility and availability of water. An important ecosystem service provided by the forest is to prevent soil erosion and provision, as well as regulate water supply.
  • Impact on India:
    • India, forest land degradation is affecting rural economy and our ability to combat climate change
    • It is also adversely impacting India’s targets to reduce greenhouse gas emissions.
Significance of the forest ecosystem
  1. Impact on multiple sectors: The health of our forest ecosystems has an impact on other sectors such as agriculture, energy, tourism, and health. A World Bank project found that support for small and medium forest improved the quality of dense forest cover, reduced seasonal out-migration by 23% as well as increase cash income
  2. Human health: Forest health is also linked to human health. Good forest enables water regulation cycles, reducing the microbial load of downstream communities
  3. Green employment: Forest sector can generate Green employment. Green jobs require low capital investment, generate multiplier effect through purchase of goods and services locally, and remain highly adaptive to changing scenarios. In India, roughly 250 million people are fully or partially dependent on forest and a majority of them belong to economically backward groups. Hence, public works programmes like the Mahatma Gandhi National Rural Employment Guarantee Act, 2005 can be used to generate jobs in the forestry sector.
  4. Fulfillment of SDGs: Green employment will also restrict land degradation and help in the fulfillment of several SDGs.
  5. Reduction in pandemics: Forest health has a close relation with the outbreak of zoonotic diseases. A strategy consisting of reducing deforestation, restricting wildlife trade and building early detection and control mechanisms can potentially reduce the risk of future pandemics
Way forward

In light of the benefits of a forest ecosystem, India can, therefore, formulate appropriate economic incentives through public finance schemes and other measures to promote growth in the sector.

In the post-COVID-19 world, pandemic resilience is going to be a significant indicator in maintaining investors’ confidence across all sectors.


As a policy action, arresting forest land degradation is the most cost-effective option to attain various SDGs. This is especially true in urban areas, where the benefits of greening are greatly undervalued.

Understanding the economics of forest land degradation is, therefore, crucial to designing the appropriate policy mechanisms to improve the health of degraded forest ecosystems and restrict human activities in such areas.

Terms to know

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