"The Cabinet meeting is scheduled for tomorrow. National Policy on Agroforestry is on the agenda," said a source.
In the Cabinet note, the Agriculture Ministry has said that the policy is necessary as the sector is affected by adverse policies, legal constraints, inadequate investments, weak markets and dearth of institutional finance.
Despite recognised benefits of agroforestry, the sector has not been able to grow due to lack of coordination between departments that oversee related sectors such as agriculture, forestry, rural development, environment and renewable energy, sources said.
NAC has also suggested providing institutional credit and insurance cover for agroforestry, facilitate industry participation and provide market access to farmers, incentives to farmers for adopting agroforestry.
Agroforestry is a land use system which integrates trees and shrubs on farmlands and rural landscapes to enhance productivity, profitability, diversity and ecosystem sustainability. It is known to have the potential to mitigate effect of climate change.