New Delhi, Jan. 8 -- The Union environment ministry has cleared the way for private and government entities to lease forest land for afforestation and timber projects without paying mandatory environmental compensation fees, marking a significant shift in India's forest conservation policy.

In a letter to state governments dated January 2, the ministry stated that afforestation and silvicultural activities - the practice of controlling forest growth and quality - undertaken under approved state plans will now be classified as "forestry activities."

Because of this new classification, these projects will be exempt from compensatory afforestation requirements and net present value (NPV) fees. These are significant financial mandates typic...