The proposed 180MW Bunakha Hydropower Project will require the permanent acquisition of private land and affect the livelihoods of dozens of households, but only one household is expected to be physically relocated, according to the project’s August 2026 Resettlement Plan prepared for the Asian Development Bank (ADB).
The plan identifies 44 affected households comprising 218 people in the project area in Chhukha Dzongkhag. Of these, 35 households are classified as severely affected, nine as vulnerable, and one as physically displaced. The figures remain provisional and will be confirmed through a detailed measurement survey before the resettlement plan is updated.
The Bunakha project is a reservoir-based hydropower scheme on the Wangchhu River, developed by Druk Green Power Corporation (DGPC) through Bunakha Hydropower Project Limited (BHPL). The project has been classified as Category B for involuntary resettlement under the ADB’s Safeguard Policy Statement.
The project will require approximately 1,139.84 acres of land. Of this, 1,108.46 acres, or about 97 percent, is State Reserved Forest Land, while 31.38 acres of private land will be permanently acquired within the reservoir submergence area.
Project design optimisation has already reduced the number of affected titleholder households from an earlier estimate of 35 to 30. The remaining affected households include non-titleholder resource users, particularly households dependent on fiddlehead fern collection in Chanachen.
The socioeconomic assessment shows that the affected population is predominantly dependent on agriculture. Livelihoods also include livestock rearing, among others. The project will therefore cause both physical and economic displacement. Most affected households will not have to move from their homes but will lose agricultural land or access to forest resources.
The assessment found that 21 structures belonging to 13 households, along with trees and crops belonging to nine titleholder households, will be affected. One household will lose its residence and will have to relocate before reservoir impoundment.
Households losing private agricultural or residential land will be offered three options: land-for-land replacement, cash compensation, or a combination of land and cash.
Under the preferred land-for-land option, replacement land of equivalent or better quality will first be sought within the same Chiwog, followed by the Gewog and then the Dzongkhag. The project will bear land-transfer transaction costs and the cost of developing replacement land.
This approach responds directly to concerns raised during community consultations. Affected households expressed a preference for replacement land rather than cash, particularly because many depend on agriculture for their livelihoods. They also sought assistance to sustain themselves while replacement land is being developed.
The consultation process recorded concerns over land replacement, roads, the labour camp and support for community institutions. The project subsequently incorporated several of these concerns into its resettlement framework.
Households also requested that scattered replacement plots be consolidated where feasible and that land development, including flattening or preparation of replacement plots, be supported by the project.
One household to be relocated
Only one household has been identified for physical relocation, but will be allowed to choose between replacement housing provided by the project, together with transitional or rental assistance, or cash compensation for self-relocation.
Two potential relocation sites within the household’s own Chiwog have been identified, subject to feasibility assessment and confirmation during the detailed measurement survey. Importantly, the household will not be required to vacate its existing residence before replacement housing or compensation is fully provided. The plan requires at least 30 days’ written notice before the household is required to leave.
The proposed relocation within the same village is also intended to minimise disruption to existing social networks and community ties. The plan currently anticipates no significant host-community impact, although this will be confirmed when the final relocation site is selected.
The resettlement plan goes beyond compensation, requiring a livelihood restoration programme to be operational before civil works begin. The central principle is that affected households should not be left worse off. Their incomes and livelihoods are expected to be restored to at least pre-project levels, with efforts made to improve earning capacity where possible. For agriculture-dependent households, the plan prioritises land-based restoration. Agricultural training and support will be provided, while affected people will also receive opportunities for project employment and procurement.
Where households lose access to common resources such as areas used for collecting non-timber forest products, continued or equivalent access will be prioritized wherever feasible. It includes skills training for 80 people, financial literacy and management training for 50 people, and agricultural training and support for 36 people.
The plan identifies nine vulnerable households that may face greater difficulty adjusting to the project’s impacts. Vulnerability criteria include households below the national poverty line, women-led households with limited earning capacity, households with a permanently disabled member, single-member elderly households and households without able-bodied members.
These households will receive targeted assistance, including priority access to livelihood restoration, skills development, employment-related assistance and additional consultation support.
The project also classifies a household as severely affected if it loses at least 10 percent of its productive or income-generating assets, or is physically displaced. The current planning figure is 35 severely affected households.
Out of the total Nu 44.72M resettlement budget, the largest component, Nu 26 million, is allocated for compensation for affected assets, including land, fruit trees and structures; Nu 4.70 million is for resettlement and rehabilitation allowances; Nu 1.07 million for vulnerable and severely affected household; and, Nu 4.47 million for relocation-site development, with additional allocations for implementation and contingencies.
The project will also apply compensation at full replacement cost. Private land compensation will use the applicable land compensation rate with a 20 percent replacement-cost supplement, while structures will be valued without depreciation or salvage deductions.
Resettlement before project works
The project will not be permitted to take possession of affected land or begin civil works in an affected area until compensation and required assistance have been completed and certified.
The detailed measurement survey will finalise the number of affected households and the extent of their losses. The resettlement plan is targeted for updating around November 2026, while compensation and land takeover are expected to take place ahead of the main civil works contract award scheduled for 15 November 2027.
Tashi Namgyal, Thimphu
