The Community Forestry Project, undertaken in 1981 was the first governmentinitiated and large-scale participatory forestry management programme in Bangladesh. Under this project the participants were promised 50 percent share from the sales proceeds of final tree harvest in addition to 100 percent of all other benefits generated . from agricultural crops, thinning materials and pruning. In 1993 five agroforestry plots, each having an area of 1.21 hectares of land were harvested at Madhyapara, Dinajpur. Although rotation was planned for a period of seven years trees were actually felled one year later. It has been the country’s first logged-over area under participatory approach. Half of the sales proceeds was distributed to the participants. This example inspired both the participants and the Forest Department.
Financial viability of the system has been explained in terms of internal rate of return, benefit-cost ratio and present net worth under three situations, viz. a) financial viability of the whole system, b) financial gain of the participants, and c) financial gain of the Forest Department. While the system as a whole is found to be highly prospective,the results also show that the benefits generated to both the participants and the Forest Department are also much encouraging. A sensitivity analysis allowing probable variations in cost and benefits reveals no financial risk of the system under any criteria. Social impacts of the project and some problems have been pointed out.