This paper reviews the evolution of forest policies and forestry institutions in Nepal and tracks the accompanying trends of change in the country?s forest cover over the last century. Our objective is to provide an essential foundation to the policy reform process that is underway in Nepal and many other Asian countries. The review shows that before 1957 the Nepalese government?s focus was on conversion of forestlands to farmlands, and extraction of timber for export. After the nationalisation of the forests in 1957 until 1976, policy-making efforts were oriented towards national control of forests through stringent laws and expansion of the forest bureaucracy. This approach failed as evidenced by widespread deforestation and forest degradation across the country during the 1960s through 1980s. Early efforts of the government and donor agencies to rectify the problem through reforestation and afforestation also largely failed, but these efforts paved the way for subsequent initiation of the participatory approach to forest management in the late 1970s. Since then, community-based forest management evolved continuously under the aegis of supportive forest policies and legislations. The present community forestry program has met with notable successes in some areas. However, the program has been confronted with some contentious issues in recent years including a policy debate over the suitability of forests in the southern lowlands (the terai) for community management and sharing of income obtained from community forests. These and some other issues surrounding the community forestry program are discussed and their implications for designing or improving future forest governance have been identified.
