Correct Option
The Compensatory Afforestation Fund Act, 2016, provides for the establishment of the Compensatory Afforestation Fund Management and Planning Authority (CAMPA) at both National and State levels. These authorities are responsible for managing the funds collected for compensatory afforestation, which are generated when forest land is diverted for non-forest purposes under the Forest (Conservation) Act, 1980. The funds are utilized for afforestation, regeneration activities, wildlife protection, and other related environmental services. Therefore, statement 1 is correct.
Incorrect Options
The Compensatory Afforestation Fund Act, 2016, primarily focuses on establishing the institutional and financial mechanisms for the management and utilization of compensatory afforestation funds. While community involvement is often considered beneficial for the success and sustainability of environmental programmes, the Act does not explicitly mandate people's participation as a legal requirement for compensatory afforestation programmes. Therefore, statement 2 is incorrect.