Exploring the prospects of the ecosystem services approach for natural resource management and poverty alleviation in India, this paper points out that it is vital to have an understanding of the political economy of negotiations over natural resource use. An appreciation of the synergies and trade-offs between ecosystem services is equally important to develop better strategies for pro-poor ecosystem management. If the distributional outcomes associated with alternative options for natural resource management are neglected, there is a risk that such interventions may fail because of resistance from those who are excluded or those who stand to lose.