Large investments are being made in the establishment of tree plantations on degraded land in Asia. These initiatives are often politically driven and aspire to achieve both economic and environmental benefits. However, the lack of clarity about the precise objectives of these schemes means that they often fail to yield either local economic or global environmental benefits. There is often a failure to negotiate with all concerned stakeholders and to recognize and resolve trade-offs. Subsidies have often had perverse impacts, and market forces may be better drivers of economic objectives of restoration programmes. Security of tenure and use rights is an important but often neglected requirement for achieving sustainability. Remnant patches of natural vegetation, even when degraded, are often valuable sources of local biodiversity in restoration schemes. The spatial patterns of different types of forest and of non-forest land are important determinants of environmental values. Biodiversity conservation requires maintaining or re-establishing habitat strips to connect natural forest blocks and protect ecological gradients. However, even monoculture plantations often have significant biodiversity value. The fundamental principles of ecosystem approaches as adopted by the Convention for the Conservation of Biological Diversity and principles for successful common property resource management provide valuable frameworks for forest restoration schemes.