In the Middle Hills district of Nepal, an IFAD-funded project has helped reverse environmental degradation and bring people out of poverty. As a result of the project’s impressive impact, the government adopted a leasehold forest policy in 2002 and integrated the approach in its poverty strategy. Now a new project is building on the success of the first, introducing livestock and microfinance components.   

Between the end of the 1970s and the mid-1990s, deforestation, land degradation and soil erosion spelled disaster for rural households in the Middle Hills district of Nepal, where a large percentage of the population is poor.

As forests disappeared, people – especially women – were forced to spend more time collecting fodder and fuelwood, which in turn led to a drop in agricultural labour supply and production and decreased  food security. However, leasehold forestry, an innovative approach introduced by IFAD in the early 1990s, has significantly reversed this trend.

A new way to tackle poverty and environmental degradation

Nepal’s government launched the Hills Leasehold Forestry and Forage Development Project in 1993. Its goal was to reduce poverty and restore environments in the Middle Hills by offering 40-year leases of small plots of degraded, public forest land exclusively to groups of the poorest rural households. Leasehold forestry user groups usually consist of 10 or fewer households. The stronger the group, the better chance it has to continue to maintain and improve the site. 

Participants rehabilitate the land by banning grazing and by stall-feeding their livestock. They also use and sell forest products such as timber, fuelwood and fodder. The leases provide poor rural people with long-term land tenure and give them the incentive to regenerate, protect and manage degraded forest areas under their use, while offering them benefits in terms of improved livelihoods.

Project aids income diversification

“Before the leasehold forestry programme we worked as labourers for our livelihoods,” says 45-year-old Mundra Bahadur Magar, a member of Langali Leasehold Forestry User Group in Chitwan.

“We were short of forage and fuelwood. At the age of 10 our children had to collect forest products instead of going to school.” But today things have changed for Magar and his family.

“We heard about this programme through the forest ranger,” he said. “He told us we could get leasehold land if we asked. We worked as suggested, by planting new species and protecting indigenous species. Because of the project we now have time for other activities. I am raising buffalo now, and conditions for the family have improved greatly now that I am making money by selling buffalo milk.”

Forty-year-old Maya Chepang, who lives in Deurali village in Makawanpur district in central Nepal, said women are now raising goats, sheep and cows and earning cash. “Our lives have changed for the better,” she said. “Women in our community are more active today than the men. We have been able to speak to other groups,  and have learned to read and write.”

When the project ended in 2003, 7,457 hectares of degraded forest land had been handed over to 12,028 poor rural households and 1,773 leasehold forestry groups had been formed. Once the leasehold forestry approach was successfully piloted and its impact was proven, the government scaled up the approach from the initial 10 districts to 26 priority districts in the hills of Nepal.

Groundbreaking approach, significant results 

“The project was a major success,” said Kati Manner, IFAD’s country programme manager for Nepal. “The most innovative and impressive element is that it was the first project in Nepal with both forestry and livestock components to focus exclusively on helping the poorest of the poor rural people.”

“But there is considerable need to include the poorest community members in development projects and to ensure more equitable distribution of the benefits from forests,” said Manner. “And because the leasehold forestry approach has been so successful, other development agencies are now piloting the same targeting approach to reach the poorest of the poor.”

The project broke new ground in other areas as well. There was a strong partnership between the Department of Forests and the Department of Livestock Services, so that forestry and livestock activities were linked. And gender and development training for project staff and participants focused on both men and women. This gender approach was presented as a best practice at the 12th World Forestry Congress held in Quebec in September 2003. The project’s impact on poverty was highlighted in a case study presented at the May 2004 conference in Shanghai, China on Scaling-up Poverty Reduction: A Global Learning Process.

A project evaluation mission in 2003 and impact studies by the Food and Agriculture Organization of the United Nations found that the leasehold forestry project has contributed considerably to improving the livelihoods of rural poor people, especially women, and to improving the condition of degraded forests.

The evaluation and impact studies showed that after five years:

• annual household incomes rose from US$270 to US$405 from leasehold-forest sources
• higher incomes translated into greater food security and improved diet for children
• the number of goats increased from an average of 3.9 to 4.4 per household  
• the amount of animal feed and forage increased significantly.
• women spent 2.5 fewer hours a day collecting forage and firewood
• women’s self esteem and confidence rose because they had more time for income-earning activities and to attend meetings, training and literacy classes
• school attendance increased because there was less need for children to herd grazing animals
• environmental degradation reversed at most sites; ground cover increased from 32 per cent to 50 per cent after one growing season, eventually reaching 100 per cent coverage
• biodiversity increased significantly; in two sites, the number of plant species increased by 57 per cent and 86 per cent

Success leads to policy change and a new programme 

As a result of the project’s impressive impact on poverty, the government identified leasehold forestry as a priority programme in its Poverty-Reduction Strategy Paper for 2002-2007.

To help Nepal implement this national programme, IFAD designed the Leasehold Forestry and Livestock Programme, which began in 2004. It focuses on further improving household forage and tree crop production, increasing household production of livestock, especially goats, providing access to microfinance institutions, and supporting the government’s capacity to implement leasehold forestry in a gender-sensitive way.

“We are building on the successful experiences of the first project,” said Manner. “We have had many years of experience with this approach and have been learning lessons along the way about how to develop it. IFAD financed several studies to review the experiences under the first project, which have provided valuable information and recommendations. And we have instigated an ongoing dialogue with the government and other development agencies and stakeholders.”

During a joint review of the programme, IFAD and the government discussed the criteria for choosing participants in the forest development programmes, options for diversifying incomes, and for collaborating with civil society.

“One thing we agreed upon was that there should be more attention to the quality of the land that is offered on the lease,” she said.

Nepal’s forestry department recently completed a series of consultations to obtain feedback from the field and regularly reviews its forest policies and management approaches.

“IFAD is very interested in supporting these processes,” says Manner. “The Leasehold Forestry and Livestock Programme is in the beginning phase. There have been some very positive developments this year, and we see great opportunities for success and further innovations under this second programme.”