Undoubtedly, cooperative society is a lever for economic development in rural areas. If this could be in line with government policies, it will be very effective to improve living conditions, employment production and income improvement and social status of rural people. The objective of this study is to observe the carbon sequestration project activities in cooperation with international organizations including UNDP and the GEF. Rangelands rehabilitation done for the Afghan refugees had been completely destroyed over a decade in Eastern Iran. In this project, cooperation and participation were formed by organizing people into groups called village development groups (VDGs), where men and women were separated and mixed as well. The cooperatives, which have reached up to 39 in their organizational structure, are micro credit fund whose financial capital is provided by the people’s voluntary savings. Results of the cooperatives’ performance during three years show that they protect and sustain rehabilitation of degraded rangeland, which are found by collecting of native seeds, creating and cultivating treasure trees and pasture. They also rely on one’s training and micro credit fund provided by the government to help people achieve other income-generating resources that ultimately lead to few poor families, improvement in social and economic aspects and growth in human development index projects in the region.
Key words: Village development, carbon sequestration project, participation ,village development groups, micro credit funds.