Annual Report 2016

Arannayk Foundation

Introduction

The Arannayk Foundation (AF), also called the Bangladesh Tropical Forest Conservation
Foundation, was established in July 2003 by the Government of Bangladesh (GOB) and the
United States Government (USG) under the provisions of the U.S. Tropical Forest Conservation
Act (TFCA), 1998. The AF’s objective is to conserve Bangladesh’s rapidly disappearing tropical
forests and biodiversity. It is registered as a not-for-profit company limited by guarantee and not
having a share capital. The AF is managed by an independent Board of Directors composed of
representatives from the GOB, USG, and five representatives from non-governmental
organizations (NGOs). By its constitution (Article of Association), the USAID Mission Director in
Bangladesh is the USG representative, and the Joint Secretary (Development), Ministry of
Environment and Forest (MOEF) is the GOB Representative. The tenure of a board member is
three years, while the Chair of the Board, elected by its members, is renewed every 12 months.
The current Chair is Mr. Ishtiaq Uddin Ahmad, Country Representative, IUCN, who was elected
in January 2016.

Under the TFCA agreement, the USG is committed to provide $8.51 million to the AF over a
period of 18 years in diminishing quarterly installments commencing in 2000. To-date, the AF
has received approximately $8.39 million. As of December 2016, the AF has disbursed 155
grants, amounting to $10.58 million, from the TFCA fund. These grants were provided to NGOs,
research and academic institutions, the Bangladesh Forest Department, and community based
organizations to implement projects on important issues of forest and biodiversity conservation.

Aside from funding projects based on the TFCA grant, the AF itself has been implementing
forest and biodiversity conservation and climate change adaptation related projects funded by
other donors (GIZ, ICIMOD, BCCRF) since 2012. In 2016 (and since 2013), a project funded by
the multi-donor Bangladesh Climate Change Resilience Fund (BCCRF) constituted the major
activity of the AF in terms of budget, geographical coverage and number of beneficiaries. The
project was jointly implemented by the Bangladesh Forest Department (BFD) and the AF with
technical and fiduciary support from the World Bank. In this project BFD was responsible for an
afforestation program involving 17,500 ha of coastal and hill afforestation and 2000 kilometer of
strip plantation and the AF was responsible for alternative livelihood development of 6,000 poor,
climate vulnerable and highly forest dependent households in nine coastal districts. During this
year, the AF disbursed TFCA grants to 14 organizations under 12 projects, all of which were
continuing from earlier years.

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Biodiversity inventory in a community conserved forest in Chittagong Hill Tracts: During
2016, the AF made an in-depth study of floral and faunal biodiversity of the Doluchari Village
Common Forest (community conserved area) of Rangamati district in Chittagong Hill Tracts
(CHT). The size of the VCF is 68.7 ha where 65 tree species and more than 150 faunal species
were recorded. Some of the faunal species found in Doluchari VCF were new records in
Bangladesh. The AF has published the information in the form of a book.

Strengthening value chain development activities in CRPAR Project: The ‘value chain
approach’ to promoting economic development of rural communities involves facilitating
collaborative efforts of all the actors involved in the production, processing and marketing of
selected commodities in order to create favorable conditions for all the actors, with particular
emphasis on enhanced benefits of the primary producers. Being market-led, sustainability of the
income generating activities under value chain development approach is automatic and does
not rely on continued support from development projects. In 2015, Arannayk Foundation
introduced value chain approach in its BCCRF-funded CRPAR project (Livelihood component)
in a pilot scale in 27 villages, working on local poultry value chain. In each village, the AF
developed a local livestock service provider (LSP) through training and linkage development
with Department of Livestock Services and private companies manufacturing and marketing
feed, vaccines,feeding and drinking pots and other inputs and equipment that are needed for
improved method of backyard poultry rearing. Within six months, the LSPs started earning BDT
3,000 – 15,000 per month from vaccination service and input business. The production of eggs
and poultry birsdsin their clients’farms also increased significantly due to reduced mortality,
rapid growth and increased frequency of reproductive cycles. While there were only 810
registered participants of the alternative livelihood program of CRPAR Project in 27 villages,
more than 9,000 households of those villages started increasing their poultry production by
utilizing quality inputs and services from the trained LSPs. Impressed by such outcomes, the
World Bank suggested AF to extend the poultry value chain development program to all of the

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200 villages under the Livelihood program of the project. In 2016, the AF extended the poultry
value chain development program to150 villages in nine districts by developing another 106
LSPs through training and linkage building support. The AF established collaboration
agreements (MoU) with two veterinary universities (Chittagong and Patuakhali) and two reputed
private companies (Renata Pharmaceuticals and Nourish Feed Co. Ltd.) for capacity building
and input supply to the LSPs. By December 2016, more than 37,500 households of 150 villages
in nine districts got involved with the local poultry value chain development program and the
monthly income of the LSPs rose to BDT 5,000 – 22,000. During this year, similar value chain
development work on beef and dairy value chains have also been initiated in 27 villages and
pond fish value chain development program in 12 villages.

Providing ‘water and sanitation’ support to forest dependent communities: There is acute
shortage of safe drinking water in coastal and hilly areas. The problem is aggravated due to
climate change. Most of the poor people of these areas also do not have sanitary latrines.
Therefore, they frequently suffer from various waterborne diseases which prevent them from
coming out of poverty (as they lose work days, spend money for medical treatment, eat up
savings and get indebted). As such, the AF took an initiative to address the water and sanitation
issue in the alternative livelihood program of CRPAR project as well as in some of the TFCA
funded projects in Chittagong Hill Tracts. The AF installed 33 deep tube wells and 150 shallow

tube wells in 119 villages and distributed to 4,173 sanitary latrines among the beneficiaries of
the Livelihood program of CRPARP. It is to be noted that out of the 33 deep tube wells, 25 were
provided by Bangladesh Steel Re-rolling Mills Ltd. (BSRM) under their corporate social
responsibility (CSR) program. Such supports helped not only project beneficiaries but also other
households of the project areas. In CHT,the AF installed one surface water harvesting system in
a village of Rowangchari, Bandarban (VCF Conservation project) during the year. All the

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households of the village (Pladai Para) now have access to safe drinking water and water for
other domestic uses.

Bringing phased-out projects of AF under a long-term monitoring and networking

program: From January 2016, the AF has undertaken a new project to monitor organizational
dynamism and development activities of community based organizations in its phased out
projects. The project is being implemented by a reputed national NGO, Proshika which was
selected through AF’s competitive grant making procedure (CGMP). The grant amounts to BDT
7.7 million for a period of two years. Proshika has assessed the current status (organizational
dynamism, revolving fund, livelihood development and forest conservation activities,
collaboration with Forest Department, etc.) of the community based organizations of 14 phased
out projects of the AF and identified their further capacity building needs.
International recognition of an Arannayk Project: One of the projects of AF in Chittagong Hill
Tracts, implemented by a local NGO ‘Tahzingdong’, received the international ‘Globe Energy
Award (Earth Category)’ which was declared in COP-22 held in Marrakesh, Morocco in
November 2016. The award was given for bringing number of community conserved
forestsunder effective restoration and sustainable management program. The project has
created access to water for more than 150 households. This has become a model for CHT.

Arannayk Foundation projects received more CSR contribution from BSRM: In 2016, a
private company – Bangladesh Steel Rerolling Mills Ltd. (BSRM) – shared their CSR fund with
the CRPAR project of AF to install 25 deep tube wells in 25 salinity affected coastal villages.
Earlier, the BSRM also provided CSR support to two other projects of the AF. One of those was
a financial grant to the Union federations of forest dependent groups of Sitakund, Chittagong to
contribute to theirrevolving loan fund for alternative livelihood development of forest dependent
households and the other one was to the Shadanpur Union Federation of forest dependent

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groups in Banskhali, Chittagong to help them installa briquette factory for reducing local
demands for fuelwood.

Grant Disbursement in 2016

In 2016, Arannayk Foundation financed 15 projects implemented by 15 organizations as listed
below.
Amount
Date of Amount of
Implementing Duration disbursed
Project Title Commen grant
Entity (Years) in 2016
cement (USD)
(USD)
TFCA Funded
1. Inani Protected Forest Area (PFA) Co-management - NGO SHED Jul-14 3 299,983 86,771
component (Phase-4)
2. Conservation of Threatened Species (Phase-2) IFESCU Jul-12 4 62,975 9,651
3. Restoration and Conservation of Biodiversity in the Denuded DAM Apr-15 2 98,202 34,522
Hills in Banskhali, Chittagong - NGO component (Phase-3)
4. Community-based Conservation of Forest Resources and Hill Flower Apr-15 2 98,202 55,756
Enhancing Rural Livelihood in Rangamati of CHT (Phase-3)
5. Restoration of Hilly Biodiversity through Community Based Anando Apr-15 2 98,202 48,741
Bio-Resource Management at Dighinala, Khagrachari (Phase-3)
6. Conservation and Regeneration of Biodiversity of Village Proshika Apr-15 2 98,202 29,877
Common Forest in Khagrachari (Phase-2)
7. Community Based Forest Resource Management for Tah Zing Apr-15 2 98,202 26,761
Sustainable Development in Rowangchari, Banderban (Phase-3) Dong
8. Swamp Forest Restoration in Shunamganj (Phase-3) CNRS Apr-15 2 98,202 36,911
9. Promotional and awareness raising activities of AF BCL Oct-10 6 96,868 7,571
10. Capacity building, monitoring &backstopping support to AF Jan-16 1 71,377 71,377
AFprojects
11. Livelihood support for conservation of Gazalia Village Toymu Jan-13 4 24,588 0
Common Forest, Bandarban Hill Tracts
12. Livelihood support for Conservation of Dhanpata Village Kabidang Jan-13 4 24,588 0
Common Forest, Khagrachari Hill Tracts
13. Monitoring of forest conservation activities of community Proshika Jan-15 2 98,202 22,192
based organizations in phased out projects of AF
14. Livelihood Development of Forest-dependent Communities in SHED Jul-15 2 98,202 38,890
and around Chunati Wildlife Sanctuary (Phase-2)
Donor Funded
15. Climate Resilient Participatory Afforestation and AF, YPSA, Mar-13 4 5,000,000 2,816,875
Reforestation Project (Part-2: Alternative Livelihoods to Support Uttaran and
Forest Communities) - BCCRF, World Bank 55 Societies
Total 3,285,895

Impacts

Through 155 grants disbursed under 38 projects during 2006-2016, Arannayk Foundation has
made significant impact towards improving conservation of some of the important but
threatened biodiversity hotspots and endangered tree species of Bangladesh. Aside from the

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conservation impacts, the AF has made significant impacts on poverty reduction, empowerment
of women and indigenous communities, reduction of CO 2 emission and improvement of
resilience of coastal communities.

Alternative livelihood development of forest dependent communities: By establishing

community-managed revolving loan funds (RLF), Arannayk Foundation has created access for
around 15,000 poor forest dependent households to soft loans for undertaking alternative
income generating activities.

As of December 2016, the RLF of 428 Community based Organizations (CBOs) of the Arannayk
beneficiaries totaled BDT 200 million (including BDT 160 million grants from the AF and BDT 40
million raised by the CBOs through participatory savings schemes and other service charges or
interests on loans). During 2009-2016, about 14,000 poor forest dependent people took loan
from the RLF. The borrowers invested the loans in various income generating activities such as
vegetable cultivation, leasing land for cultivation of rice and other crops, cow rearing, beef
fattening, poultry rearing, fish cultivation, handicrafts making, nursery business, buying rickshaw
van and varieties of small businesses. Through effective use of the RLF loans, the borrowers
have been able to improve their economic conditions and payback their loans on time. The rate
of repayment of RLF loans is over 95%. Due to the adoption of the AIGAs, the average annual
income of the Arannayk project beneficiaries increased by 96% in the projects on co-
management of protected areas and reserved forest, 47% in the projects in CHT and 125% in
the project on swamp forest in 5-6 years and 51% in CRPARP in just three years. Some
beneficiaries who had started with one AIGA such as vegetable cultivation, poultry rearing, goat
rearing or a grocery shop, have now diversified their income generating activities by adopting
other AIGAs too. Collection of forest resources from public forests by the Arannayk project
beneficiaries reduced drastically due their increased income from AIGAs.

Institutional development of community based conservation organizations: Through the

support of the AF, around 15,000 poor forest dependent households are now organized as self-
help groups at their respective villages and, in most of the places, the village-level groups have
formed their federations at the Union level. Altogether there are 428 village-level groups and 80
Union federations. About 60 of the Union federations have got registration from the Department
of Cooperatives and the remaining ones are also in the process of getting registered. Arannayk
Foundation also has established Co-management Councils and Co-management Committees
(CMC) in five reserved forests, three of which are now national parks (protected areas). Twenty-
five of such AF-supported community based organizations (village-level group, Union
Federation, CMC) have constructed their permanent office buildings (with support from the AF),
which are also treated as multi-purpose community houses. Aside from meetings and other
activities of the CBOs, these multi-purpose community houses are also used for various social
events and development activities such as holding medical and vaccination camps, non-formal
primary education and training programs and various social events. These houses are also
used as shelters during disasters and as temporary lodging house for school students coming
from the villages for public examinations.

Adoption of improved cooking stoves by rural households: To reduce the fuel wood needs
of its project beneficiaries, the AF promotes Improved Cook Stoves (ICS) among them. By

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2016, AF helped 10,600 forest dependent households to adopt ICS. The use of ICS reduces
household fuel wood requirement by about 50%. As a rural household in Bangladesh consumes
90 kg fuel wood per month on average (according to a published research paper), the ICSs
adopted by the beneficiaries of Arannayk projects save 5724 tons of fuel wood and thus 10,493
tons of CO2 emission per year. The improved cook stoves also helped women in two more
ways: (a) they could spend more time for alternative income generating activities as they did not
to go for collecting fuel wood and (b) they got relief from respiratory diseases that they used to
suffer from due to the smokes created by traditional cook stoves inside the kitchen.

Improvement of homestead agroforestry in forest dependent households: Arannayk’s

motivational campaign, training and input support enabled most of its project participants to
plant diverse species of fruit trees, timber and fuel wood yielding trees, vegetables and
medicinal plants in available spaces of their homesteads in all of its project areas. At least 1.5
million trees have been planted by around 15,000 households in the last 10 years.

The homestead agroforestry improvement activities have resulted in increased diversity of crops
(vegetables) and trees species in the homesteads of AF’s project beneficiaries and thus
increased their year-round production and consumption of diversified vegetables and fruits,
cash income from selling of surplus production and resilience to natural shocks. A recent survey
in AF’s CRPAR project areas revealed that while the project participants were growing only 2-3
summer vegetables and 1-2 winter vegetables at the beginning of the project, they grew 8-9
summer vegetables and 3-4 types of winter vegetables in 2016. Similarly the number of species
of fruits trees in their homesteads increased from 2-3 to 6-7 and that of timber trees from 1-2 to
3-4.

Restoration of tree cover in deforested and degraded forest areas: During 2009-2013,
Arannayk Foundation helped Bangladesh Forest Department to restore the forest cover in the
denuded and degraded areas of three protected areas and two reserve forests. Similarly, it
helped local communities of CHT and swamp forest areas to restore forest cover in the denuded
and degraded areas of 18 village common forests, 11 places (villages) of USF lands and 5
swamp forests during 2009-2016. Altogether around 4.5 million trees of local species have been
planted over in the degraded areas of the above forests that cover 27,784 hectares of forest
land in total.

In a recent study at a project area in Khagrachari district of Chittagong Hill Tracts involving
participatory reforestation of denuded hills through agroforestry approach, it was found that
each households earned more than BDT 10,000 from mango and litchi while BDT 30,000 –
50,000 from bamboo5-6 years after they were planted. The production is increasing over time.
In community conserved areas, bamboo is harvested and distributed to the communities for
their domestic uses. Based on the requirements bamboo is distributed and the surplus is sold in
the market. It may be mentioned that bamboo must be harvested from the clump once the culm
reaches three years. If bamboo culm is not harvested after three years, it will naturally die.

Improved protection of public forests: In Bangladesh, protection of public forests in is a big

challenge for the Forest Department. The AF jointly with Forest Department established
community patrol groups involving beneficiaries of AF projects for protection of plantations and

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natural forests. This is done mostly in areas where Forest Department is unable to protect due
to their resource limitations (manpower and accessibility). So far, the AF has established 50
CPGs usually with 21 members in each group. The CPG members accompany Beat Officer of
Forest Department to protect forests. Every day three members accompany with the Beat
Officer. In addition, if there is any illegal harvesting within the knowledge of the CPG, they
convey the message to the Beat Officer and accompany the Beat Officer to stop the illegal
harvesting. During 2016, 20 CPG members were injured in one operation where the miscreants
were trying to encroach forest land through establishing houses. Through joint actions, many
such illegal harvesting and encroachment could be stopped.

In order to sustain motivation and devotion of the CPG members, both AF and FD have taken
certain steps towards supporting livelihood of the CPG members. FD gives priority to those
people in selecting beneficiaries for social forestry programs while the AF provides them special

grants to develop group enterprises as sources of secured livelihood. Moreover, community

patrollers usually get priority in receiving loan from the RLF of the Community Based
Organizations.

Conservation of endangered native tree species of Bangladesh: By identifying the

remaining mother trees in forests and ex-situ conservation sites, developing propagation
protocols and establishing seed stands at Chittagong University campus, IFESCU has saved 63
endangered native tree species of Bangladesh forests from the threat of extinction. The IFESCU
also distributed seedlings of some those species to Forest Department, BFRI, some NGOs and
private-sector organizations for planting in degraded forests and other institutional and private
lands.

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Bringing village common forests under sustainable management: The Village Common
Forests (VCF) are natural forests that are maintained by indigenous communities around their
villages with the objective of maintaining tree cover and biodiversity to protect the environment
in the face of deforestation, to sustain supply of wood and bamboo required for house
construction of the community members, to ensure the source of water by keeping annual and
perennial springs and small rivers into sustained flow and to secure sustainable source of
essential livelihood resources such as fuel wood, wild vegetables and medicinal herbs. The
VCFs are managed, protected and utilized collectively by the indigenous communities under the
leadership of the head of the mouza (‘Headman’) or village (‘Karbari’) or by educational or
religious institutions or a committee formed by the community leaders, who govern the
management according to customary rules. Jhum cultivation and hunting are strictly prohibited
and all sorts of fireworks and unpermitted access are restricted in the VCFs. Harvesting of
bamboo is generally done in 2-3 years intervals. The VCFs are mostly small, averaging 20-120
hectares in size. Many of the VCFs are now lost due to encroachment, unsustainable use and
conversion to other land-uses and many of the existing ones are also either degraded or at risks
of being so due to increased population pressure, lack of proper management and lack of
security of tenure. Since 2009, the AF has supported a number of local NGOs to build
awareness and capacity of the concerned communities to conserve and sustainably manage
the VCFs. So far 18 VCFs, having a total area of 754 ha, have been brought under sustainable
management through awareness raising, human and institutional capacity building and
alternative livelihood development of the concerned communities along with enrichment planting
of native tree species in the degraded areas of the VCFs, planting of bamboos along stream
banks and regulated harvests of bamboo from the VCFs. As a result vegetation cover of the
VCFs and the flow of water from the VCFs in the dry season have increased significantly and
the socio-economic conditions of the indigenous communities have improved.

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Empowerment of women: Considering the importance of involvement of women for
sustainable livelihood development of rural households and also for conservation of forest
resources, Arannayk Foundation always emphasizes on active participation of women in its
community based forest conservation projects. More than 60% of the total project participants
of Arannayk projects are women. Aside from technical skill development and input support for
alternative income generating activities, Arannayk Foundation provides leadership and
organizational development and management (ODM) trainings to the women project
participants along with their male counterparts. It also makes sure that there is adequate
representation of women in the executive committees of the village-level groups and Union-level
federations of the project beneficiaries. Women representatives constitute 48% of the total
executive committee members of the community based organizations of forest dependent
people organized by the Arannayk projects. Thanks to the Arannayk capacity building support,
these women are now not only able to perform their decision making and management roles in
their group and federations but they have also strengthened their position in the society as well.

The capacity building interventions of the Arannayk Foundation have also developed
entrepreneurial capacities of the women which are evident from their ability to take, utilize and
repay RLF loans. Most of the RLF borrowers are women and the rate of repayment of the loans
by them is almost 100 per cent. The women generally invest their loans in such micro-
enterprises as grocery shop, small tea stall, cattle fattening, poultry rearing, vegetable
cultivation and handicrafts production. These women are now self-reliant and are making
significant contribution to the livelihood of their family. By reducing their dependence on
collection of forest resources, the AIGAs have been contributing to the conservation of the
forests too. Arannayk’s steps to promote improved cooking stoves (ICS) among its project
beneficiaries has not only reduced the consumption of fuel wood but also aiding in securing a
better health for women by reducing incidence of respiratory diseases amongst them by keeping
their kitchen smoke-free.

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Leveraging TFCA Resources

Arannayk Foundation strived to gain high leverage in utilizing TFCA resources for its projects by
mobilizing funds (co-financing) from other sources. More particularly, due to the depletion of
TFCA resources, Arannayk Foundation has been increasingly depending on funds mobilized
from other donors. The amount of fund that it received or generated from different sources in
2016 was USD 2,097,941. Only 6.35% of it came from the TFCA grant of the US Government,
while 74.97% came from BCCRF, 18.65% from investment income and 0.03% from another
source (Jolkona Foundation). In case of grant disbursement during the year which amounted to
a total of USD 3,285,895, about 82.34% was from BCCRF fund and only 17.66% from TFCA
grant.

Concluding Remarks

Arannayk Foundation has consistently maintained high level of management efficiency in grant
making and project management services by keeping its core expenses (staff salary, rents,
utilities, operation and maintenance of vehicles, etc.) as low as possible. In 2016, the total
spending of Arannayk Foundation amounted to USD 3,511,702, only 6% of which was spent for
its core expenses, while 94% was awarded as grants to different entities for implementation of
13 projects.In terms of effectiveness, the
Arannayk projectshave been very successful
in demonstrating effective ways to restoring
and conserving forest cover and biodiversity in
denuded and degraded forest lands under
different administrative and social
conditions.The role and contribution of the AF
is appreciated by all stakeholders including the
Ministry of Environment and Forests (MOEF),
Forest Department, Ministry of Chittagong Hill
Tracts Affairs (MOSCHTA), development
partners and forest dependent communities.

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But, the sustainability of the AF has remained uncertain as its primary fund flow – the TFCA
grant – is going to stop in 2018. Under this circumstance, an endowment is needed for the AF to
sustain its activities.

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