Compensatory Afforestation Fund (CAF) is a Rs. 54,000-crore tranche collected for nearly a decade as environmental compensation from industry, which has razed forest land for its business plans.
The CAF Act 2016 established an independent authority — the Compensatory Afforestation Fund Management and Planning Authority — to execute the fund.
The rules governing the management of the fund were finalised in August 2020.
The rules specify that the funds are to be used for catchment area treatment, wildlife management, forest fire prevention, soil and moisture conservation work in the forest.
It cannot be used for payment of salary, travelling allowances, making buildings and buying office equipment for forest officers.