ITC’s farm forestry programme is a telling example of linking business purpose with the creation of sustainable livelihoods and environment protection. It is not well known that apart from initial conditions of unequal endowment of natural resources, climatic seasonality is a critical determinant of poverty in India. Access to livelihood fluctuates seasonally, both in the strength of the labour force and in the number of days of work available during particular months. Deterioration in the natural resource base also impairs the means of sustainable income. The erosion of the soil by several weathering agents results in the loss of humus and biotic life, leading to reduction in fertility and productivity. As per the estimates of the Indian Council for Agricultural Research (ICAR), the present average soil loss is over 16 tonnes per hectare per year, which is at least three to five times the normal. Areas affected seriously by salinity, alkalinity and wind and water erosion cover an estimated 126 million hectares, accounting for nearly 41% of the total geographical area of the country. Further, it is estimated that out of the total 95 million hectares of land under rainfed conditions, 70 million hectares are in some stage of land degradation. Sub-optimal land use is also evident from the fact that degraded wastelands cover at least 35 million hectares, around 18% of total cultivable land.Forest cover plays a critical role in maintaining the soil and water base for food production in arid and semi-arid lands. In areas where wind is the main agent of erosion, wooded areas can help contain erosion. Trees also alleviate the ill-effects of drought and desertification and provide protection from the adverse effects of seasonality. Landsat imagery data indicate that out of 75 million hectares recorded as forest area, only 64 million hectares sustain actual forest cover. Out of these, only 35 million hectares have a crown density of 40%. Thus real forests account for barely 11% of the geographical area of the country.