Forests in Pakistan can flourish with robust property rights

Photo credit: Farhan Chawla (license CC BY 2.0)

Forests are rapidly dwindling in Pakistan, at a rate of about 2.1 percent annually between 1990 and 2005 — one of the highest deforestation rates in the world. About two thirds of Pakistan’s forests are owned by the state, and almost all of the remaining privately owned forests are subject to strict government usage controls, so about 97 percent of forests in Pakistan are effectively under state jurisdiction. A new study by Ali Salman, executive director of the Pakistan-based Atlas Network partner Policy Research Institute for Market Economy (PRIME), explains how returning forests to a system of private incentives and robust property rights would encourage both sustainable use and conservation.

Based on current trends, Pakistan will miss its Millennium Development Goals (MDG) target of achieving 6 percent forest cover, which would require an estimated additional 1.051 million hectares of forest area. The entire national forestry apparatus is malfunctioning, however, and current estimates suggest that it will take at least another 15 years for the country to meet its promised 6 percent target — which is already far behind the world average of 30 percent.

“The government does undertake afforestation measures each year, however it falls significantly short of forest losses,” Salman explains in the PRIME study, which has been developed as part of Atlas Network’s Liberating Asian Enterprise project. “At best, the afforestation measures barely make up for the annual loss, without making any significant incremental gains. As the draft National Forest Policy 2015 admits, ‘Pakistan is one of the low forest cover countries’ and then myopically states that ‘existing forest resources (are) inadequate for meeting domestic demand of wood.”

Pakistan’s Forest Development Corporation (FDC), a state-owned enterprise, has operated since 1976 to limit the role of contactors to cutting and marketing of trees, while retaining the ownership of timber in state’s hands. However, tightened government control only result in rampant emergence of timber traders, often regarded as “timber mafias,” who devised a complex system to get around existing afforestation policies and made a huge profit out of over-harvesting and illegal trade. The state turned to participatory cooperatives in the 1980s and ’90s, with the explicit purpose of transferring the management and control of forests to locals, but the process was heavily politicized.

Salman cites Nobel laureate economist Elinor Ostrom, who devoted much of her research career to studying the incentive structures of common pool resources, and the strategies that local communities use to manage them effectively.

“Self-organisation is more likely to occur when forest resources are highly salient to users, when users have a common understanding of the problems they face, when users have a low discount rate, when users trust one another, when users have autonomy to make some of their own rules, and when users have prior organisational experience,” Ostrom wrote. “Users will overuse the forest unless efforts are made to change one or more of the variables affecting perceived costs or benefits.”

During all this time, forest policies in Pakistan have paid little attention to the tenurial rights of local people, and this infringement of their rights has created an incentive structure by which forest dwellers have the most to gain from the short-term profits that can be gained by their considerable deforestation. State-controlled forest policies have undermined the natural incentive that forest-dependent communities would otherwise have to preserve their own natural resource and ecosystem, placing the state forest departments in perpetual conflict with them.

“The forests and its products, including timber, fuelwood, and ecological services, present a bundle of economically exploitable rights,” Salman concludes. “On the other hand, the poverty and hunger of forest dwellers, and an excessive harvesting by timber traders, will defy all goals of conservation and protection. The punitive nature of state laws by armed enforcements will only deteriorate the level of trust that has been shaken since colonial times. Thus the ownership of forests should go back to where it originally belonged: the locals. This requires that the leviathan footprint should be removed from forests altogether. This also needs legally backed and fully delineated property rights structure. In the absence of private property rights, and faced with the ever expanding urban-industrial and real estate complex in Pakistan, the locals will have no incentive to conserve their habitat, and forest resources will be depleted beyond its regenerative capacity.”