In 2000, a portion of the lake, the Kanjiracode creek on the southeast end of the lake has been completely destroyed due to dumping of clay into the lake by the State government-owned PSU, the Kerala Ceramics Limited (KCL), Kundara. Alarmed at the danger posed by the dumping of clay, the local residents formed a Pollution Control and Prevention Joint Action Committee. The action committee largely comprised those from the fishing community and coir workers of the area. They protested strongly against KCL. To stop the deterioration of the estuary, Ashtamudi Management Plan was proposed in 2001. In 2002, the lake was designated as a Ramsar site. Later on in 2004, the Union Ministry of Environment and Forests has sanctioned a Management Action Plan (MAP) with an aim to conserve and mange the biodiversity of the wetland. The District Rural Development Agency (DRDA) and the Brakishwater Fish Farmers Development Agency (BFFDA) were jointly given the responsibility to implement the 22.83 lakh plan. In spite of the constitution of a Special Task Force (STF) for the conservation of Ashtamudi lake, the STF could not achieve much. Kerala Sasthra Sahithya Parishad (KSSP) is also working on the conservation of the lake since 2006.In the year 2007, the district administration conducted a revenue survey of the lake as part of a move to save it. Massive encroachments were detected during this survey. The survey also detected that traditional mangrove forest areas of the lake had been destroyed to facilitate encroachments. As a result of these encroachments, almost 80 per cent of the lake's banks comprised vertical walls built with laterite stones and granite. These walls prevent spawning of fish. STF was allocated a sum of 30 lakh by the Union Ministry of Environment and Forests to revive mangrove forests on the banks of the lake. Under this programme, 2,40,000 mangrove saplings were planted along the banks of the lake in phases that began two years ago. Only few are surviving now. In 2007, the Kollam Corporation commissioned a biogas plant at the mouth of the lake with the help of State Pollution Control Board. The plant operated only for once and twice and raw sewage was pumped into the lake. By 2008, the situation worsened and Pollution Control Board directed the Corporation authorities to close down the plant and reopen it only after ensuring proper waste treatment management. The fisheries department also tried to put forward their help to conserve the lake. In the same year, the department launched a major operation to bust the destructive methods of fishing employed in Ashtamudi Lake.