Involuntary Resettlement0P 4.12 Principles and Objectives

A Resettlement Overview

Why does the Bank have an Involuntary Resettlement Policy?

How has the Bank’s policy evolved? What are policy objectives and key principles What is role of Financial Intermediaries?

An Evolving Resettlement History

No mitigation: Those losing land must make a sacrifice for national development

Eminent domain: compensation for assets favors relatively well-to-do.

Risks of impoverishment: Recognizing interests of poor and vulnerable, too

Resettlement can be a development opportunity: Extending the reach of project benefits

Key Policy Objectives

Avoid, minimize, or otherwise mitigate land acquisition and associated adverse impacts

Assist all affected people to improve, or at least restore, incomes and living standards

Resettlement as a development opportunity for households and community infrastructure

(Mitigating risks for affected people helps minimize risks to borrower and Bank, too)

Key Planning Principles

The Bank requires the borrower to prepare and implement a plan to identify, minimize or mitigate adverse impacts.

Implementers and affected people should be involved in planning process

Plan scope of coverage includes all contemporaneous impacts essential to functioning of Bank-supported project

Bank acceptance of plan required at appraisal (or prior to subproject approval in FI projects)

Key Guiding Principles

All affected persons should be compensated or assisted in other ways, regardless of legal status

Compensation for all assets at replacement cost (enough to obtain assets of equivalent value)

Income restoration may require supportive measures in addition to compensation for assets

Affected persons should be involved in resettlement planning and implementation

Consultation

Information Disclosure

Grievance Procedure

Role of Financial Intermediaries

Prepare and agree a Resettlement Policy Framework with the Bank

Screen all proposed on-lending activities for land acquisition and associated resettlement impacts

If RPF is deemed unnecessary, legal documents require compliance if impacts should occur

For all subprojects involving relevant impacts, Bank approval of a resettlement plan required before accepted for financing

Recurring Issues and Problems

Defining project scope: “Indirect impacts” and “linkage” in application of Bank policy

Bridging the eligibility gap: Assisting vulnerable people and those who lack full legal recognition

Covering all costs: ‘Replacement cost’ valuation, transaction costs and transitional support

Asset stock versus income flow: Going beyond compensation to income restoration and incorporation of development opportunities

In FI projects, ensuring coordination with subclients in implementation and reporting