(1) The Government of Nepal may grant any part of the degraded national forest, in the form of leasehold forest, to any body corporate established under the prevailing law, by making an agreement as prescribed, for any of the following purposes:
(a) To produce raw materials required for the industries based on forest products,
(b) To sell and distribute or utilize the forest products by increasing its production through afforestation,
(c) To operate agro-forest crops or livestock firms in a way that is compatible with the conservation and development of the forest,
(d) To operate farm of insects, butterflies and wildlife in a way that is compatible with the conservation and development of the forest,
(e) To operate eco-tourism business in a way that is compatible with the conservation and development of the forest.
Explanation: For the purpose of this Section, “degraded forest” means the forest of which crown coverage is less than twenty percent.
(2) Notwithstanding anything contained in sub-section (1), the Division Forest Office may, by making a work plan for the alleviation of poverty of the people who are below the poverty line, provide a forest area in the form of the lease-hold forest to a group of such people, to carry out income generating programs in a way that is compatible with the conservation and development of the forest.