The GoN has formulated national Policy on Land Acquisition, Compensation and Resettlement for Development Project (PLACRDP) with the objective of providing services like compensation, resettlement and rehabilitation to the affected people depending on the nature of effects, so as to help them keep their social and economic situations before the project or help them reach the higher socio-economic ladder. The Policy also aims to adopt a uniform approach in carrying out these measures and reducing adverse risks of project implementation thus ensuring smooth operation of project. This Policy shall provide a guideline in implementing the project and establishing coordination among various ministries on land acquisition issues.

The policy has the following guiding principles:

• Involuntary resettlement should be avoided where feasible or minimized, exploring all available alternative project design. Where it is not feasible to avoid resettlement, resettlement activities should be conceived and executed as sustainable development programs, providing sufficient investment resources. 

• Appropriate and adequate compensation for the loss of assets or income is a fundamental right of affected person;

• Physically displaced people must be relocated with facilities such as school, health post, drinking water, security etc.;

• Vulnerable groups such as Janajati/Adivasi, Dalits, landless, women, especially women-headed households, poverty groups and senior citizens are entitled to special benefit and assistance packages in addition to compensation and resettlement;

• Affected persons should be assisted to restore at least their pre-project income and livelihood sources. The absence of legal title to land should not be a bar for compensation, resettlement and rehabilitation assistance. 

• Cash compensation at full market value (equivalent to replacement cost) for all acquired land. If theprovisionofreplacementlandisnotfeasible,with thestipulationthatperson who becomes a marginal landholder as a result of land acquisition should be provided withreplacementlandofequivalentproductivityorvalue;

• Cashcompensationatreplacementcostforthelossofallstructures(residential, business andotherstructures),withnodeductionfordepreciationorforsalvageablematerials;or provision of a replacementhouse;

• Cashcompensationforprivatetreesbasedontheloss of income, 

• Cashcompensationforlossofstandingcrops;and

• For nontitle holders and squatters: The Policy states that squatters and non-titled landholders are not entitled to compensation for the land they occupy. However, they will be entitled to other rehabilitation assistance.