The Forest Department will soon finalise the mechanism for making payments to farmers under the carbon credit scheme for raising forests on private and community land as part of the World Bank-funded Mid-Himalayan Watershed Development Project. Himachal last year became the first state in Asia and only second in the world to introduce a scheme for selling carbon credits to the World Bank directly to enable the villagers to earn Rs 3,000 to Rs 5,000 per hectare annually from the plantations for 30 years. A team headed by the additional chief secretary, forests, recently visited Costa Rica to study various modes of payment being followed in the implementation of bio-carbon projects. In Himachal, 95 per cent of the forests are on government land and private forests were negligible. The minimum area for raising plantation is 500 sq m and the species planted must attain a height of 5 m. The money will go to the individual in case of private plantation and in the case of community land, a part of it will go to the panchayat concerned and the major portion will be divided among the group of people who protect the plantation. The Forest Department has identified 25 species, including fruit and medicinal plants like mango, fig and aonla, which not only have a good capacity of carbon sequestration but also help regulate the hydrological cycle. The purchase of carbon credits will be in addition to the Rs 365 crore which the World Bank is providing for the project. In all new plantations will be raised over 12,000 hectares of degraded and fallow land under the scheme in a phased manner. Only the land lying fallow since 1990 can be taken up for plantation.