Plantation industry in India has been growing rapidly. Since the 90s, private initiatives were seen as eucalyptus and teak plantations. Investors could invest in the highly lucrative teak farms with assured returns over a long period of time. Teak plantations offered huge returns on investments made over a period of 15 to 20 years.

Private investment in plantation industry was facilitated by the needs of the forest-based industries for raw materials. The forests could not meet adequately the raw material needs of the forest-based industries. Teak plantations were to address the gap between demand and supply of teak in India.

Many forest-based industries, e.g. Western India Match Company Ltd (WIMCO), ITC Bhadrachalam Paper Mills and Ballarpur Industries Ltd, have entered into arrangements with farmers to meet their raw material requirements by providing financial and technical assistance for initiating and maintaining plantations on private lands.

The growth of towns and cities has also created the demand for quality timber. It is only by way of developing private teak plantations the growing demand of timber in housing and furniture making could be met adequately. The fact is that, even though India is one of the largest producers of teak in the world, it cannot meet its own demand for quality timber.