ADB Working Paper on Investing in Agroforestry: A Nature-Based Strategy for Climate Resilience
SDG 13: Climate Action | SDG 15: Life on Land | SDG 2: Zero Hunger | SDG 1: No Poverty
Ministry of Agriculture & Farmers Welfare | Ministry of Environment, Forest and Climate Change (MoEFCC)
The ADB Working Paper on Investing in Agroforestry (December 2025) identifies agroforestry as a critical nature-based solution for restoring degraded landscapes and building climate resilience across Asia and the Pacific. By deliberately integrating trees, crops, and livestock on the same land, these multifunctional systems regulate microclimates, enhance soil health, and improve water retention, thereby reducing the vulnerability of rural communities to climate shocks like floods, landslides, and droughts.
Key findings and strategic pillars from the report include:
Multifunctional Co-Benefits: Agroforestry delivers substantial long-term gains in carbon sequestration, biodiversity conservation, and food security. For instance, complex systems in Mindanao store three times more carbon (192 tons/ha) than traditional tree plantations.
Adoption Barriers: Despite long-term benefits, adoption is hindered as smallholder farmers often face high upfront costs (e.g., $900/ha in Cambodia), delayed returns on investment (gestation periods), and limited access to quality seeds and credit.
Supply Chain Gaps: Current agricultural value chains and extension services predominantly favor conventional monocultures, leaving agroforestry products—like indigenous fruits and specialty crops—disconnected from global buyers.
Financial Innovation: Scaling requires blended finance facilities, tailored microfinance products, and results-based carbon payments (sequestering 2–10 tCO2e/ha/year) to offset initial establishment costs.
Inclusive Governance: Addressing gender inequities in land tenure and decision-making is essential, as women often prioritize food security and environmental protection in tree species selection.
Policy Integration: Successful scaling requires aligning agroforestry with Nationally Determined Contributions (NDCs) and National Adaptation Plans (NAPs), alongside strengthening land tenure rights
What is Agroforestry? It is a land-use management system where woody perennials (trees, shrubs, palms, or bamboo) are deliberately used on the same land-management units as agricultural crops and/or animals. This approach mimics natural ecosystems to optimize interactions between plants, animals, and the environment, ensuring that a single plot of land provides multiple revenue streams—such as timber, fruits, and fodder—while simultaneously providing critical ecological services like erosion control and microclimate regulation.
Policy Relevance
The ADB’s findings are highly pertinent to India’s National Agroforestry Policy and its goal of achieving a carbon sink of 2.5–3 billion tonnes by 2030. India faces similar systemic challenges of land degradation and climate vulnerability, particularly among its nearly 80% smallholder farmer base.
Key strategic alignments for India include:
Bridging the Gestation Gap: The report’s emphasis on short-term income generation—such as intercropping fast-growing annual crops like ginger, turmeric, and pigeon pea during tree-maturation years—is critical for India’s hilly and arid regions (e.g., the Northeast or Bundelkhand).
Digital Public Infrastructure: Leveraging digital solutions like blockchain-based supply chains and digital wallets for input subsidies can bypass intermediaries, reducing transaction costs for rural Indian cooperatives.
Mainstreaming “Care Economy”: Empowering women-led cooperatives in nursery management and value addition for non-timber forest products (NTFPs) can boost India’s Female Labour Force Participation Rate (FLFPR) while strengthening community-based forest management.
Repurposing Subsidies: India can utilize the report’s insights to transition from “commodity-focused” subsidies to payments for ecosystem services (PES), incentivizing farmers to adopt carbon-sequestering tree-based farming.
Follow the full report here: INVESTING IN AGROFORESTRY- A STRATEGY FOR BUILDING CLIMATE RESILIENCE