Sourcing Hub

Timber Risk Score: 21 / 100 in 2017. The Timber Legality Risk Assessment contains an evaluation of the risk of illegality in India for five categories and 21 sub-categories of law. We found:

  • Specified risk for 15 sub-categories.
  • Low risk for 4 sub-categories.
  • No legal requirements for 3 sub-categories.

This page provides an overview of the legality risks related to timber produced in India.

India has around 70 million hectares of forests, which covers 24% of the country. Around 15.7 million hectares are primary forest, 43 million hectares of otherwise naturally regenerated forest, and around 12 million hectares are planted forest. The total forest area is increasing by around 1 million hectares a year.

About 85% of the forest area is publicly owned, and 15% privately owned (FAO, 2015). Most of the public forests are administered by the government, and some of them by communities and indigenous groups.

India produced almost 50 million m3 of logs in 2014, of which only a small proportion was exported. The export value of primary timber products exceeded USD 80 million (ITTO, 2015). 

Illegal logging and trade of high-value timber is a major problem in many parts of the country. In 2009. the Ministry of Environment and Forests estimated that 2 million m3 of logs were illegally felled per year. Several legality risks are present in India, relating to legal rights to harvest, taxes and fees, timber harvesting activities, third parties' rights, and trade and transport. 

As India is one of the world’s largest importers of wood-based products, it is also a major consumer of illegal timber. The volume of illegal imports has increased, and in 2012 almost 20% of timber imports were estimated to be illegal. There has been limited acknowledgement of the problem within the country, and little response from the government (Chatham House, 2014). Companies sourcing timber from India should take care to ensure the risks identified are not present in their supply chains, or have been sufficiently mitigated.

Corruption Perceptions Index

Score: 40 / 100 in 2021

Rank: 85 out of 180 countries in 2021

 

Bans and restrictions

All CITES-listed species (appendices I, II and III) from natural forests are banned from being exported for commercial purposes. Cultivated species in Appendices I and II are permitted to be exported

 

Armed conflict

With continued violence in Kashmir and a heightened threat of terrorist activity by Pakistan-based militant groups, tensions and concerns over a serious military confrontation between nuclear-armed neighbors India and Pakistan remain high (Global Conflict Tracker).

According to the Uppsala Conflict Data Program there were 8 598 deaths from 2010-2019.  

CITES species

CITES appendix II:  Aquilaria malaccensis, Aquilaria khasiana, Gonystylus macrophyllus, Pterocarpus santalinus, Rauvolfia serpentina, Dalbergia spp. 

Certification

FSC Certified Forest Area: 516,128 hectares (4 December 2019).

Timber sources

  • Find out the different sources of legal timber
  • Determine which source type your timber comes from
Timber source type Description of source type

Government Reserved Forests / Unclassed Forests

Timber from Government Reserved Forests / Unclassed Forests (can be natural forests, plantations, degraded areas or barren land. They are managed either solely by the State Forest Department or jointly by the State Forest Department and local communities through Joint Forest Management Committees (JFMCs). They may only be harvested by the Forest Department.

The following documents are required:

  • Forest Working Plans (Forest Management Prescriptions as per the National Working Plan Code for a period of ten years)
  • Transit passes which details the origin and destination of all consignments.

Private plantations

Timber from private plantations, including block plantations, agroforestry plantations or farm forestry plantations, industrial plantations etc.

The following documents are required:

  • Permits  from the Forest Department or local panchayats (local elected representative bodies) as per harvesting rules for specific species
  • Harvest permission letter from the Forest Department / local government (panchayat) head
  • Transit pass is optional as per transit rules. In cases where the transit pass requirement is waived, substitute documents such as Agricultural Produce Market Committee (APMC) tax receipts are considered legal documents

Risk assessment summary

Legal rights to harvest

Legal rights to harvest, EUTR
  • Violent armed conflict, including that which threatens national or regional security and/or 
    linked to military control (1.1, 1.4, 1.13, 1.14)
  • Encroachment on forest land (1.1)
  • Lack of Harvesting Permit (1.4)
Taxes and fees
Taxes and fees, EUTR
  • Under-invoicing the total turnover – meaning that goods and services taxes are calculated based on false sales and purchase figures (1.5)
  • Harvesting Fees and Transport Permit Fees not paid correctly (1.5)
  • Non–payment of the goods and services taxes (1.6)
  • Non-Payment of Tax Collected at source (TCS) for timber (1.6) 
  • Non-payment of Income-tax (1.7)
Timber harvesting activities

timber harvesting activities, EUTR
  • Timber harvested beyond the authorized volume and below the minimum felling diameter (1.8)
  • Non- authorized and protected species are harvested (1.8, 1.9)
  • Lack of appropriate implementation of the Working Plan (1.10)
  • Un-availability and lack of use of Personal Protective Equipment (PPE's) (1.11)
  • Lack of Health and Safety procedures training among the workers (1.11)
  • Non-payment of minimum wages (1.12)
  • Involvement of child labour in forest management activities (1.12)
  • Incidences of bonded labour (1.12)

Third parties' rights

Third party rights, EUTR
  • Overuse of forest resources due to industrial logging, infrastructure development projects (Dams, Highways etc.) or mining threatens the rights of traditional forest dwellers (1.13)
  • Deprivation of the rights of forest-dwelling schedule tribes and other traditional forest dwellers:
    1)  To hold and live in the forest land for habitation or for self-cultivation for livelihood.
    2) Ownership and access to collect, use, and dispose minor forest products.
    3) Deprivation of Community rights and right of entitlement such as fish and other products of water bodies.
    4) Deprivation of Habitat rights for primitive tribal groups and pre-agricultural communities.
    5)  Deprivation of right to protect, regenerate or conserve any community forest resource which they have been traditionally protecting and conserving for sustainable use. 
    6) Deprivation of right to in-situ rehabilitation in cases of illegal eviction or displacement.
    7) Deprivation of rights of settlement and conversion of all forest villages, old habitation into revenue villages (1.13, 1.14 & 1.15)
Trade and transport
Trade and transport, EUTR
  • False declarations are made  regarding species and their volume in the Harvesting Permit and Site Logbook in the harvesting site (1.16)
  • False declarations are made regarding species and their volume on transport permit (1.16, 1.17)
  • Transportation of timber from quarantine phytosanitary zones without a valid phytosanitary  certificate (1.17) 
  • Risk of timber export bypassing official customs checkpoints (1.19)
  • False reporting (smuggling) of CITES species (1.19)
  • Illegal exports of CITES species (1.20)

 

Specified risk species

Common/trade name Scientific name Risk information 

Agarwood

Aquilaria malaccensis

CITES-listed 

Agarwood

Aquilaria khasiana 

CITES-listed 

Ebony 

Diospyros ferrea 

CITES-listed 

Ramin

Gonystylus macrophyllus 

CITES-listed 
Red sandalwood Pterocarpus santalinus  CITES-listed 

Chinese yew

Taxus chinensis

CITES-listed 
Yew Taxus fuana  CITES-listed 
Himalayan yew Taxus wallichiana  CITES-listed 

 

Mitigate the risks in your supply chain

Learn which actions we recommended to mitigate the risks associated with the timber sources from India

Source Certified Materials 

NEPCon believes that third party certification (for example FSC and PEFC certification) can provide strong assurances of the legality of the products they cover. Companies seeking to mitigate the risks of sourcing illegal timber should seek to purchase third party certified materials wherever possible. 

While the European Timber Regulation does not include an automatic “green lane” for certified products, it does recognise the value of certification as a tool for risk assessment and mitigation. The European Commission says that companies “may rate credibly certified products as having negligible risk of being illegal, i.e. suitable for placing on the market with no further risk mitigation measures, provided that the rest of the information gathered and the replies to the risk assessment questions do not contradict such a conclusion.”

For more information on using certified materials in your due diligence, including how to assess whether a certification system meets EUTR requirements, see the page on Certification and Due Diligence.

Mitigation recommendations

There are five recommended actions to mitigate the risks associated with the timber sources from India. 

1. Fully map your supply chain

2. Obtain and verify documents

  • Land tenure documents
    • Land records and ownership documents
    • Records of rights to government forests as provided to private persons
    • Public notifications showing government ownership of forests
  • Harvesting permission
    • Harvesting permits, auction documents, allotment letters and payment records
    • Forest Division Working Plans (for Government forests)
    • Harvest permits issued by the Forest Department (for specific agroforestry species)
    • Government orders showing species that have been exempted from harvest permits (for agroforestry sources)
  • Tax related documents
    • Receipts for payments of harvesting-related royalties, taxes, harvesting fees and other charges. Check that volumes, species and qualities given in sales and transport documents match the fees paid
    • APMC receipts from Mandi Samities. Check they correspond to the harvested material where applicable (agroforestry products)
    • Sales documents, including applicable sales taxes. Check that sales prices are in line with market prices
    • Receipts for payment sales taxes. Check that taxes paid are in line with the relevant VAT schedule of classification of goods and applicable VAT rates
    • Records of VAT paid and filed with the sales tax authorities
    • Permanent Account Number (PAN). Check that it is valid
    • Tax Deduction and Collection Account Number (TAN). Check that it is valid
    • Income tax records as submitted to the tax authorities
  • Harvesting regulations
    • Purchase documents. These can provide evidence that wood was not sourced from protected areas
    • Permission letters as required by State harvesting rules (for protected species)
    • Records for compliance with provisions as per the Plantation Labor Act, 1951 
  • Trade and transport documents
    • Required trade permits. Check they exist and are documented
    • Required transport documents. Check they exist and are documented
    • Check that volume, species and qualities are classified according to legal requirements
    • Check that documents related to transportation, trade or export are clearly linked to the specific material in question
    • Vehicle commercial license. Check that it is in place
    • Excise forms and other such legal documentation. Check that it is in place
    • Export, import and re-export certificates issued by the Director General Foreign Trade (for all cross-border trade of CITES-listed species) 
    • Legal receipts. Check that the species and quantity transported are documented

3. Consult stakeholders

  • Authorities confirm the validity of harvesting permit
  • Financial authorities confirm that all required income and profit taxes have been paid
  • Authorities confirm that operations are up-to-date regarding payment of applicable sales taxes
  • Customary land owners confirm that:
    • Customary rights are observed during harvesting activities
    • Prior and informed consent has been given, where applicable
    • Indigenous peoples’ rights are not being violated

4. Carry out on-site verification

  • Confirm that harvesting takes place within the limits specified in the harvesting permit
  • Confirm that the information regarding area, species, volumes and other details given in the harvesting permit are correct and within the limits prescribed in the legislation
  • Confirm that Working Plan recommendations have been implemented (in the case of government forests)

5. Conduct targeted timber testing

  • Conduct timber testing on samples of purchasd material to verify the species or origin of timber, where appropriate
Profile Publication Date
2022-12-05