Financial and economic suitability of agroforestry as an alternative to shifting cultivation: The case of the Chittagong Hill Tracts, Bangladesh

As in other mountain regions of Asia, agricultural lands in the Chittagong Hill Tracts (CHT) of Bangladesh are undergoing degradation due primarily to environmentally incompatible land use systems such distorted from of shifting cultivation (jhum) requiring the slash(i)ng and burning of vegetation every year. Agroforestry is considered to be environmentally suitable' for the mountainous areas like CHT, as the rate of soil erosion under such systems is considerably less than jhum. To design strategies in the pursuit of promoting agroforestry its financial and economic benefits need to be evaluated systematically. Based on three criteria such as benefit-cost ratio, net present value, and return to labor, this paper evaluated the financial and economic benefits of agroforestry and jhum using farm household data. Information was collected from farm households and agricultural commodity traders through questionnaire surveys, case studies, focus group discussions, and key informant interviews following a two-stage sampling method. The results show that economic returns from agroforestry are better than from jhum in terms of all the three criteria. When economic benefits of two land use systems are analyzed by taking into account the cost of nutrient depletion arising from soil erosion, agroforestry appears to be more attractive than jhum. The analysis revealed that despite higher environmental and economic benefits the low adoption of agroforestry is largely attributed to policy and institutional constraints such as insecure land tenure, complicated transit rules, double levy on agricultural commodities, and farmers' poor socio-economic condition. Findings of the study indicate that there is a prospect for promoting agroforestry by eliminating the existing policy and institutional barriers combined with the provision of necessary support services and facilities. (c) 2006 Elsevier Ltd. All rights reserved.