Resettlement Plan

May 2012

PRC: Gansu Urban Infrastructure Development and Wetland Protection Project

Dingxi Urban Infrastructure Development Component

Prepared by Dingxi ADB Project Management Office for the Asian Development Bank.

CURRENCY EQUIVALENTS (as of 30 April 2012) Currency unit – yuan (CNY) CNY1.00 = $0.1593 $1.00 = CNY6.2785

ABBREVIATIONS

ADB – Asian Development Bank AV – administrative village AHs – affected households APs – affected persons HH – households CRO – client resettlement office DMG – Dingxi Municipal Government DPMO – Dingxi Project Management Office DUCIAM – Dingxi Urban Construction & Investment and Asset Management Ltd Co. LAR – land acquisition and resettlement PRO – project resettlement office ROs – resettlement offices RP – resettlement plan SES – social economic survey Twp township

WEIGHTS AND MEASURES

ha – hectare km – kilometer km2 – square kilometer m – meter m2 – square meter mu – Chinese unit of measurement for land area (1 mu = 666.67 m2 = 0.0667 ha)

NOTE

(i) In this report, "$" refers to US dollars.

This resettlement plan is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

GANSU URBAN INFRASTRUCTURE DEVELOPMENT AND WETLAND PROTECTION PROJECT

Dingxi Urban Infrastructure Development Component

(ADB No:44020-PRC)

RESETTLEMENT PLAN

Dingxi ADB Project Management Office

30 April 2012

Dingxi Municipal People's Government

A Letter of Guarantee on the Strict Implementation of Resettlement Plan of Dingxi’s Infrastructure Construction Project of the ADB Loan Gansu Urban Infrastructure Development and Wetland Protection Project

Abbreviation

ADB Asian Development Bank

APs Affected Persons

AV Administrative Village

HH Household

CRO Client Resettlement Office

DPMO Dingxi Project Management Office

DUCIAM Dingxi Urban Construction & Investment and Asset Management Ltd Co. mu 1mu = 0.006 ha

PAH Project Affected Household

PAP Project Affected Person

PRO Project Resettlement Office

RMB China yuan, the unit of Chinese currency

RP Resettlement Plan

SES Social Economic Survey

Twp Township

¥ CNY

Note: All abbreviations were explained in the text.

TABLE OF CONTENTS

A LETTER OF GUARANTEE ON THE STRICT IMPLEMENTATION OF RESETTLEMENT PLAN OF DINGXI’S INFRASTRUCTURE CONSTRUCTION PROJECT OF THE ADB LOAN GANSU URBAN INFRASTRUCTURE DEVELOPMENT AND WETLAND PROTECTION PROJECT

EXECUTIVE SUMMARY ...... 1

E1. DESCRIPTION OF THE PROJECT AND LAND ACQUISITION AND RESETTLEMENT IMPACTS ...... 1 E2. RESETTLEMENT PRINCIPLES AND ENTITLEMENTS ...... 1 E3. PUBLIC PARTICIPATION AND GRIEVANCE ...... 1 E4. RESETTLEMENT AND LIVELIHOOD REHABILITATION ...... 2 E5. INSTITUTIONAL ARRANGEMENT ...... 2 E6. COST AND SCHEDULE ...... 2 E7. MONITORING AND EVALUATION ...... 2

I． PROJECT OVERVIEW ...... 3

1.1 INTRODUCTION OF DINGXI CITY ...... 3 1.2 PROJECT CONTENTS ...... 3 1.3 AFFECTED REGIONS ...... 4 1.4 MEASURES TO MITIGATE IMPACTS ...... 8 1.4.1 Measures Adopted at the Project Design Stage ...... 8 1.4.2 Measures to Be Adopted during LAR ...... 8 1.4.3 Measures to Be Adopted during Construction...... 9

1.5 PREPARATION AND PROGRESS OF THE PROJECT ...... 9 1.6 OWNERSHIP OF THE COMPONENT ...... 10 II. PROJECT IMPACT ANALYSIS ...... 11

2.1 DEFINITION OF PROJECT IMPACT ...... 11 2.2 PROJECT IMPACT SURVEY ...... 12 2.3 PROJECT IMPACTS ...... 13 2.4 IMPACTS OF LAND ACQUISITION ...... 13 2.4.1 Land Acquisition ...... 13 2.4.2 Temporary Land Occupation...... 20

2.5 AFFECTED BUILDINGS ...... 20 2.5.1 Affected Residential Buildings ...... 20 2.5.2 Affected Buildings of Enterprises and Institutions ...... 20 2.5.3 Affected Temporary Buildings ...... 24

2.5.4 Affected Attachments on the Buildings ...... 24

2.6 AFFECTED VULNERABLE GROUPS...... 24 2.6.1 Identification of Affected Vulnerable Groups ...... 24 2.6.2 Affected Families of Vulnerable Groups ...... 25 III. SOCIO-ECONOMIC SURVEY ...... 26

3.1 GENERAL INTRODUCTION OF SOCIO-ECONOMIC DEVELOPMENT OF THE REGIONS AFFECTED BY THE PROJECT ...... 26 3.1.1 Population ...... 26 3.1.2 Socio-economic development of Anding District ...... 26

3.2 GENERAL SITUATION OF AFFECTED VILLAGES ...... 27 3.3 SAMPLE SURVEY ...... 29 3.3.1 Sample Selection ...... 29 3.3.2 Basic Charactaristics of Sampling Households ...... 29 3.3.3 Revenue Situation of Affected Households ...... 34 3.3.5 Building Structure ...... 3.3.6 Land Characteristics ...... 36 3.3.7 Impacts after LAR ...... 37 3.3.8 Affected People’s Basic Understands on LAR ...... 40 3.3.9 IMPACT ON ETHNIC MINORITIES AND GENDER ...... 43

3.4 ASSESSMENT OF SOCIAL IMPACT ...... 44 IV. LEGAL AND POLICY FRAMEWORK ...... 45 4.1 GENERAL ...... 45 4.2 POLICY BASIS ...... 45 4.2.1 Relevant Laws and Provisions Enacted by the Central Government ...... 45 4.2.2 Regulations and Policies Enacted by the People’s Government of Gansu Province ...... 45 4.2.3 Regulations and Policies Enacted by the DMG ...... 46 4.2.4 ADB’s Policies on Involuntary Resettlement ...... 46

4.3 SUMMARY OF MAIN LAWS, REGULATIONS AND POLICIES ...... 46 4.3.1 Summary of Relevant National and Provincial Laws and Regulations ...... 46 4.3.2 Abstracts of related regulations and rules of Gansu Province ...... 50 4.3.3 ADB’s Relevant Policies on Involuntary Resettlement ...... 51 4.3.4 Comparison of ADB’s involuntary resettlement policies with the PRC’s LAR policies ...... 52

4.4 TARGET OF RESETTLEMENT ...... 53 4.5 COMPENSATION CONDITIONS ...... 53

4.6 COMPENSATION PRINCIPLES ...... 54 4.7 COMPENSATION STANDARDS ...... 54 4.7.1 Land Compensation Standards ...... 54 4.7.2 House Compensation ...... 55 4.7.3 Compensation for Business Operation ...... 57 4.7.4 Compensation for Temporal Housing ...... 57 4.7.4 Temporary Land Occupation...... 57

4.8 ENTITLEMENT MATRIX ...... 58 V. PUBLIC PARTICIPATION AND CONSULTATION ...... 61

5.1 PUBLIC PARTICIPATION AND CONSULTATION ACTIVITIES PERFORMED 61 5.2 FEEDBACK ON PUBLIC PARTICIPATION AND CONSULTATION ...... 61 5.3 CONSULTATION PLAN WITH AFFECTED POPULATION ...... 64 5.4 METHODS OF CONSULTATION OF AFFECTED POPULATION DURING PROJECT IMPLEMENTATION ...... 65 5.4.1 Direct Meeting ...... 65 5.4.2 Indirect Consultation ...... 66

5.5 INFORMATION DISCLOSURE ...... 66 VI. IMPLEMENTATION PLAN FOR RESETTLEMENT AND REHABILITATION ...... 67

6.1 OBJECTIVES AND PRINCIPLES ...... 67 6.1.1 Objectives of resettlement and rehabilitation ...... 67 6.1.2 Principles of Resettlement and Rehabilitation ...... 67

6.2 THE RELOCATEES‘ WILLINGNESS OF RESETTLEMENT ...... 68 6.3 THE RESETTLEMENT OF RURAL HOUSEHOLDS ...... 69 6.4 RESETTLEMENT AND REHABILITATION OF AFFECTED SMALL BUSINESSES ...... 71 6.5 RESETTLEMENT PLAN OF BEIERSHIPU ...... 73 6.6 REHABILITATION OF THE LIVING CONDITIONS OF FARMERS AFFECTED BY LAND ACQUISITION ...... 73 6.6.1 The Overall Plan ...... 73 6.6.2 The RP for APs’ production ...... 74 6.6.2 Social Pension Insurance of the Land Farmers ...... 74

6.7 TRAINING FOR LANDLESS PEASANTS ...... 75 6.8 SOCIAL SAFEGUARD FOR AFFECTED POOR AND VULNERABLE GROUPS ...... 76 6.9 REHABILITATION OF SPECIAL FACILITIES ...... 77 6.10 SCHEDULE OF RESETTLEMENT AND REHABILITATION ...... 77

VII. BUDGET AND MANAGEMENT OF RESETTLEMENT ...... 80

7.1 COMPOSITION OF RESETTLEMENT FUND ...... 80 7.1.1 Land acquisition compensation ...... 80 7.1.2 Relocation compensation ...... 80 7.1.3 Specialized compensation for rehabilitation and conversion ...... 80 7.1.4 Administrative cost ...... 81 7.1.5 Other relevant costs ...... 81 7.1.6 Contingency cost ...... 81

7.2 RESETTLEMENT BUDGET ...... 81 7.3 ALLOCATION AND PAYMENT OF RESETTLEMENT FUND ...... 83 7.3.1 Resettlement fund receivers ...... 83 7.3.2 Source and flow of resettlement fund ...... 85

7.4 PAYMENT, MANAGEMENT AND MONITORING OF RESETTLEMENT FUND85 7.4.1 Payment of resettlement fund ...... 85 7.4.2 Management and monitoring of resettlement fund ...... 85 VIII. RESETTLEMENT ORGANIZATIONS ...... 86

8.1 ORGANIZATIONAL STRUCTURE ...... 86 8.2 RESPONSIBILITIES OF ORGANIZATIONS ...... 88 8.2.1 Resettlement Leading Group ...... 88 8.2.2 Dingxi Foreign Load Office ...... 88 8.2.3 DUCIGC (Dingxi Project Management Office) ...... 88 8.2.4 Anding Urban Construction Bureau ...... 89 8.2.5 Dingxi Land Resources Administration Bureau, Anding Branch ...... 89 8.2.6 Anding Urban Housing Demolishment Office ...... 89 8.2.7 Township Resettlement Group ...... 90 8.2.8 Village Committee Resettlement Group ...... 90 8.2.9 External monitoring organization ...... 90

8.3 PERSONNEL AND FACILITIES OF RESETTLEMENT ORGANIZATIONS AT ALL LEVELS ...... 90 8.4 MEASURES FOR INSTITUTIONAL STRENGTHENING ...... 91 IX. COMPLAINTS AND APPEALS ...... 93

9.1 METHODS OF COLLECTING DISSATISFACTION AND COMPLAINTS ...... 93 9.2 PROCEDURE OF COMPLAINING AND APPEALING...... 93 9.3 PRINCIPLES OF HANDLING COMPLAINTS ...... 94 9.4 CONTENTS AND WAYS OF REPLYING TO COMPLAINTS ...... 94

9.4.1 Replies to complaints ...... 94 9.4.2 Ways of replying complaints...... 94

9.5 RECORDS OF COMPLAINTS AND APPEALS AND RELEVANT FEEDBACK . 94 9.6 CONTACT INFORMATION FOR COMPLAINTS AND APPEALS ...... 95 9.7 BUDGET FOR COMPLAINTS AND APPEALS MANAGEMENT ...... 95 X. RESETTLEMENT MONITORING ...... 96

10.1 INTERNAL MONITORING ...... 96 10.1.1 Purpose and principles ...... 96 10.1.2 Procedure of internal monitoring ...... 96 10.1.3 Contents of internal monitoring ...... 97 10.1.4 Methods of internal monitoring ...... 98 10.1.5 Internal monitoring agency and personnel assignment ...... 101 10.1.6 Responsibility of internal monitoring agency ...... 101 10.1.7 Cycle of internal monitoring and reporting ...... 102

10.2 EXTERNAL MONITORING ...... 102 10.2.1 Purpose of external monitoring ...... 102 10.2.2 External monitoring organization and monitoring personnel ...... 102 10.2.3 Assignments of the external monitoring organization ...... 103 10.2.4 Means and procedures of external monitoring ...... 103 10.2.5 Contents of independent monitoring ...... 104 10.2.6 Reporting system for independent monitoring ...... 106 APPENDIX I RESETTLEMENT INFORMATION BOOKLET ...... 115 I. General situation of the project ...... 115 II. Laws and regulations and compensation rates in regard to land acquisition .. 115 III. Resettlement and strategies ...... 116 IV. Planned resettlement and project implementation schedule ...... 117 V. Rights and obligations of affected population ...... 117 VI. Assistance to vulnerable households ...... 118 VII. Land acquisition and relocation agencies ...... 118 VIII. Booklet clarifications ...... 118

EXECUTIVE SUMMARY

E1. Description of the Project and Land Acquisition and Resettlement Impacts

1. The Dingxi Urban Infrastructure Development Component (the Project) of ADB Financed Gansu Urban Infrastructure Development and Wetland Protection Project consists of four components including: (i) Urban Road Construction and Improvement (six new roads and one improved), (ii) Bridge Construction, (iii) Stormwater and Sewage Works, and (iv) Road Ancillary works such as lighting and landscape. The last three components will be constructed within the existing rights-of way of the roads, so will not cause any resettlement impacts. Therefore, this Resettlement Plan (RP) focuses only on component one. 2. The Project will affect 11 groups, 4 village committees, and 1 town. In total, 988.57 mu1 of land will be acquired permanently, while 60 mu of land will be occupied temporarily. Among the permanently acquired land, 926.57 mu are collective-owned and 62 mu are state-owned. 323 households and 1,419 persons in total will be affected due to the land acquisition. The total area of buildings to be demolished is 34,729 square meters (m2). 121 rural households and 472 persons in total will be affected due to the house relocation. 27 small businesses with a total affected structure area of 4,986 m2 will be affected by relocation.

E2. Resettlement Principles and Entitlements

3. The RP was prepared in compliance with the Land Administration Law of the People‘s Republic of China (2004), Law of the People's Republic of China on Administration of the Urban Real Estate (2007 Revised), Regulations regarding the Administration of Urban Housing Relocation (implemented from January 21, 2011), Guidelines Regarding Urban Housing Demolition and Relocation Estimation, and other applicable regulations. The RP was also based on local policies regarding land acquisition and resettlement (LAR) in Gansu Province and Dingxi City, and ADB‘s Safeguard Policy Statement (2009). Based on consultation with the local governments and affected persons (APs), Dingxi Urban Construction & Investment and Asset Management Ltd Co., (or Dingxi ADB Project Management Office), the implementing agency, has adopted a set of resettlement principles and an entitlement matrix: (i) Compensation for land acquisition, residential housing, and non-residential buildings will be paid to the APs; (ii) For land acquisition, compensation fees include land compensation, a resettlement subsidy, and compensation for crops and trees; (iii) compensation for private business running buildings will be paid to the APs; (iv) all house buildings will be paid compensation for housing site land, structure replacement, and other relocation allowance; (v) house attachments will be compensated for structure replacement cost without compensation for housing site land; (vi) the compensation payments will be in cash according to the appraised value of the land and fixed property assets; (vii) Compensation for crops, trees, other facilities, and temporary impacts will be paid directly to the APs; and (viii) Income losses resulting from reduced production and/or sales and wages caused by the Project will be assessed and compensated in cash.

E3. Public Participation and Grievance

4. From December 2010 to May 2011, a series of consultation activities were carried out with the APs, resettlement communities (RCs), institutions and enterprises, and other project stakeholders. The APs have participated in the preparation of the RP through the measurement and socioeconomic surveys, and community meetings. Their concerns and comments have been integrated into the RP. Further consultations will be held during the implementation of the RP. A grievance procedure has been established for the APs to redress

1 ―mu‖ is a Chinese measuring unit for land and equals to 667 square meters. 2

their LAR issues, including four channels: (i) RCs or local resettlement offices (ROs), (ii) ROs of the Project, (iii) Dingxi Project Management Office (DPMO), and (iv) taking legal action to the people‘s court.

E4. Resettlement and Livelihood Rehabilitation

5. To minimize the resettlement impacts to the APs and restore their living standards, detailed programs of restoration and relocation have been arranged in the RP. Based on the socioeconomic survey and analysis of the affected households, and local experiences in relocation and resettlement of similar projects, measures for resettlement and income restoration have been prepared. These measures include monetary compensation, unified resettlement housing, provision of economically affordable housing, distribution of living expenses to the APs, employment creation by the local safeguard system, skill training for the APs, employment related to the Project, and non-monetary support and so on. 6. About 62 mu of state-owned land and 926.57 mu of collectively-owned land will be compensated in cash based on the type of land loss. About 60 mu of land will be occupied temporarily along the roads to be constructed. In terms of house relocation, monetary compensation will be paid to 121 households based on their choices. About 98 households chose collective resettlement in a new community (to be built new houses by themselves after being compensated). Some households like to purchase economic houses; five households opt to build houses by themselves at the same village groups and will get cash compensation for their structures and have the option to choose relocation sites in their own village subject to approval for building their houses from the village collective committees. About 27 small businesses will suffer demolition impacts. They will be compensated for their lost assets, relocation, and transitional allowance will be covered. 51 employees will be affected but not suffer from income losses.

E5. Institutional Arrangement

7. The DPMO will assume the overall responsibility for the implementation of the LAR, including the planning, implementation, financing, and reporting of the LAR. The Dingxi Urban Construction & Investment and Asset Management Ltd Co. (DUCIAM) will take the primary responsibility for the resettlement consultation, implementation, and timely delivery of entitlements. To ensure smooth implementation, the staff in charge of the LAR will undertake training on resettlement implementation organized by the DPMO. The resettlement implementation schedule has been prepared based on the preparation and construction timetable. The RP will be finalized based on the final design and detailed measurement survey and be submitted to ADB for review and approval prior to award of civil work contracts.

E6. Cost and Schedule

8. The total budget for the LAR of the Component is about CNY141.184 million. It is anticipated that the LAR will start in August 2012 and be completed by the end of September 2013.

E7. Monitoring and Evaluation

9. A detailed plan for both the internal and external monitoring and evaluation (M&E) is included in the RP. The DPMO will submit an internal monitoring report semi-annually to ADB. Furthermore, the DPMO will employ an external resettlement monitoring institute or firm as the independent external monitor in order to deliver external monitoring reports. A thorough baseline study will be completed before the LAR begins. The first monitoring report will be submitted in August 2012. After that and until project completion, semi-annual monitoring reports will be prepared and submitted for ADB‘s review. 3

I. PROJECT OVERVIEW

1.1 Introduction of Dingxi City

10. Dingxi City, located in the middle of Gansu Province, with a total area of approximately 20,300 square kilometers (km2) and a total population of approximately 2.94 million in 2010. 4 national highways (187.8km), three provincial highways (96km) and 10 county roads (271.5km) pass through Dingxi City. There are also two dedicated highways (19.4km) and 10 township roads (140.2km) in Dingxi. The Project is located in Anding District of Dingxi City. 11. Anding District is the political, economic and cultural center of Dingxi City, with a total area of 4,225 km2 and a total population of 0.47 million which includes 0.36 million rural population and a population density of 111.43 persons per km2 in 2010. Anding District consists of 19 townships, 306 village committees, and 2,274 villager groups. In 2010, the gross domestic product (GDP) of Anding was CNY2.7 billion, the farm land was about 1.718 million mu, the sown area was 1.699 million mu, the grain output was 248,366 tons, and the net income per capita of rural resident is CNY2,397.26. 12. This Project includes seven roads (13.33 km in total): six new constructions and one expansion. These seven roads account for 8.3% of the total road network in a new developing urban area of Dingxi City. The Dingxi Municipal Government (DMG) plans to invest CNY786.65 million to construct the road and related infrastructures in the new urban area, including US$40 million and domestic counterpart funds of CNY522.65 million for the Project.

1.2 Project Contents

13. The construction of the Project includes seven roads and bridges with a total length of 13.3 km as presented in Table 1-1.

Table 1-1: Project Contents

Width of Red Width of Length Name of Road Starting & End of Road Line Landscape Belt (m) (m) (m) From north Zhengfu Road to Jiaotong Road 4,035.30 40 16 Nanba Road (South to North) From north Zhengfu Road to Xihuan Road 3,857.40 36 16 Nanba Road(S to N) Xincheng Avenue From north Zhengfu Road to 1,414.90 52 16 and Bridge Beier Road(S to N) Xihuan Road to Xingcheng South Beian Road 791.90 18 16 Avenue(W to E) Middle Beian Xihuan Road to Xingcheng 769.10 18 16 Road Avenue(W to E) Xihuan Road to Xingcheng North Beian Road 735.40 18 16 Avenue(W to E) North Zhengfu Road to North Dingxi Road 1,721.40 18 16 Xihuang Road(S to N) Total 13,325.40

14. The civil work of the Project plans to start from October 2012 and is expected to be completed in November 2016.

1.3 Affected Regions

15. The Project will affect four village committees with a total of 988.57 mu of permanent land acquisition, including 926.57 mu land of collectively-owned and 62 mu of state-owned. 323 households, and 1,419 persons in total will be affected by the land acquisition. The total area of buildings to be demolished is 34,729 m2, which will affect 121 rural households and 472 persons. Totally, 398 rural households and 1,693 persons will be affected due to the land acquisition or the house relocation, in which 46 households and 198 persons will be affected by both land acquisition and the house relocation. 27 small businesses and 51 employees will be affected by relocation with a total affected area of 4,986 m2 due to Jiaotong Road expansion. The Project map is shown in Figure 1-1. Detailed affected persons information is presented in Table1-2. 5

Figure 1-1: Dingxi Infrastructure Project 6

Table 1-2: Affected Land and Structure Areas, Household, Small Business, and Persons

Stated Collectively Affected by -owned Total Affected by Road –owned Land Land Affected by Demolition Small Business Land (mu) Both (mu) Acquisition (mu) HH person m2 HH person HH person m2 HH person Jiaotong Rd. 62.00 276.80 338.80 107 492 23,963.6 63 267 20 85 4,986 27 51 Xihuang Rd. 0 300.72 300.72 60 272 4,913.0 16 55 8 34 0 0 0 Xingcheng AvenueIII 0 144.25 144.25 57 239 0 0 0 0 0 0 0 0 and Bridge South Beian Rd. 0 40.36 40.36 26 102 0 0 0 0 0 0 0 0 Middle Beian Rd. 0 39.20 39.20 27 112 142.0 1 6 0 0 0 0 0 North Beian Rd. 0 37.49 37.49 19 78 2,282.6 13 34 9 38 0 0 0 North Dingxi Rd. 0 87.75 87.75 27 124 3,429.0 28 110 9 41 0 0 0 Total 62.00 926.57 988.57 323 1,419 34,730.2 121 472 46 198 4,986 27 51 8

1.4 Measures to Mitigate Impacts

16. Resettlement has been considered as a key part of the work during the planning and implementing of the Project. With an evaluation of construction costs, social and environmental consequences and so forth, efforts have been made to minimize the impact of the resettlement.

1.4.1 Measures Adopted at the Project Design Stage

17. At the stage of planning and design, for the purpose of minimizing the negative impact of project construction on local society and economy, the DMG held a few joint meetings, with attendance of the consulting units and design institutes, to discuss how to optimize the design program and minimize the negative social and economic impact of the resettlement. 18. At the design stage, the principles of project optimization to minimize the impact of resettlement are described as follows: (i) First, carry out project optimization and comparative selection, examine closely the impact of project construction on local society and economy, and try to occupy vacant land and minimize the occupation of cultivated land – if land occupation is unavoidable. (ii) Second, minimize relocation if unavoidable, and regard it as a key indicator for program optimization and comparative selection. Meanwhile, reasonable space is to be reserved for the connection of this Project with other municipal facilities. (iii) Third, give full consideration to the resettlement and try to minimize LAR during the comparative selection among different design programs. (iv) If land acquisition is unavoidable, the DPMO will help affected people to restore the quality of life and livelihoods through compensation and livelihood restoration measures, especially the livelihood of vulnerable groups. 19. In the initial project proposal, 1,235.71 mu of land would be acquired, and 39,854.6 m2 of buildings would be demolished that would involve 137 households and 548 persons. Most of the land acquisition and the building demolishment would happen in the main residence and commercial areas. In order to reduce the impact of resettlement, the new design principles have been adopted as below: (i) narrow the width of the roads if possible, and (ii) improve and expand the existing roads. In the end, six new roads and one reconstruction road have been finalized. Compared to the initial design, 247.14 mu of land acquisition has been cut down and 5,126 m2 of buildings have been saved from demolishment. Accordingly, 153 households will not be affected by land loss and 16 households will not be forced to relocate. The comparison is presented in Table1-3.

Table 1-3: Comparison Different Project Proposal

Second Final Item Unit Initial Proposal Optimization Proposal Proposal Land Acquisition mu 1,235.71 1,034.16 988.57 247.14 Affected HH HH 476 438 323 153 Affected Persons person 2,113 1,944 1,419 694 Building m2 39,855 38,453 34,729 5,126 Demolishment Affected HH HH 137 128 121 16 9

Second Final Item Unit Initial Proposal Optimization Proposal Proposal Affected Persons persons 548 512 472 76 Affected HH 30 30 27 3 Businesses

Data source: Dingxi Urban Construction & Investment and Asset Management Ltd Co.

1.4.2 Measures to Be Adopted during LAR

20. In the event that the LAR is unavoidable, in order to mitigate the local impacts of the project construction, the measures to be taken are as follows: (i) Collect basic information, conduct an in-depth analysis of the local socio-economic status, and prepare a feasible RP to ensure that the displaced persons would not be influenced due to the implementation of the Project. (ii) Encourage the participation and supervision of the public and listen to opinions and advice from the affected population. (iii) Strengthen internal and external monitoring, establish highly efficient feedback mechanisms and channels, and minimize the period for processing information to ensure the timely solution of problems occurring in the construction. Notify displaced persons in advance, arrange sites for relocation, compensate the losses of displaced persons, minimize the idling period, and provide jobs for employees of affected enterprises. (iv) During the relocation, get help and support from local governmental authorities to ensure the smooth implementation of resettlement, and to reduce the pressure and loss of displaced persons, institutions and enterprises.

1.4.3 Measures to Be Adopted during Construction

21. The following measures are to be adopted during construction to mitigate negative impact: (i) Prepare the construction plan and arrange traffic organization design with caution; minimize the impact of construction on the surrounding environment and traffic order. When excavating, all the factors will be taken into full consideration. The excavation, installation of pipelines and backfilling will be completed in the shortest time possible. For a road crossing another road with heavy traffic, the construction work will not be carried out in rush hour (but rather at night time to ensure smooth traffic flow in the day).It is forbidden to destroy existing pipelines. Warning signs, signals and leading marks will be set up for vehicles and pedestrians. After the completion of the construction, the site will be cleared and opened to the traffic. (ii) Dredged spoil shall be timely removed. (iii) In the area within 200 meters away from residences of the civilians, the construction is forbidden from 10 pm to 8 am. (iv) The construction contractors shall timely contact the local environmental sanitation department to clear and clean the wastes in the construction sites.

1.5 Preparation and Progress of the Project

22. According to the need of the preparation for resettlement work, the cut-off date for any

new construction in the affected areas of all components was set as December 31, 2010. The construction status at the deadline is taken as the reference for eligible housing structures. The Dingxi PMO, noticed village committees and asked village committees to notice APs during the survey in December 2010 and January 2011. In May 2011, the PMO checked with APs who received the notice. The RP of the Project is prepared according to the inventory of the properties affected by LAR, socioeconomic investigation of the APs, and data of the technical feasibility study report. The RP will be finalized based on the final design and detailed measurement survey and be submitted to ADB for review and approval prior to award of civil work contracts.

1.6 Ownership of the Component

23. The executing agency of the Project is the DMG. The DPMO, on behalf of the DMG, is responsible for organizing the implementation of the Project and practicing the specific management functions. The implementing agency is DUCIAM, who is responsible for detailed work in the project preparation and implementation. 11

II. PROJECT IMPACT ANALYSIS

2.1 Definition of Project Impact

24. A physical survey scope of the project impact is determined according to the project planning scope provided by the design institute. It consists of vehicle roads, non-motor vehicle lanes, pavement and greenbelts. Since the Project is still under the optimization design, the design institute may carry out the optimization design accordingly; therefore, the data on LAR in this RP may be further adjusted. The DUCIAM will finalize this RP based on the final design and detailed measurement survey and will submit to ADB for review and approval prior to award of civil work contracts.. 25. The Project impact is defined as follows: (i) Permanent occupied land. All varieties of cultivated land and uncultivated land to be used permanently within the red line range of the Project. Cultivated land mainly includes dry land, vegetable land and so on; uncultivated land mainly includes waste land, housing site and so on. (ii) Temporary land acquisition. All varieties of land to be used temporarily during construction period, which can be recovered after construction. (iii) Relocated buildings. All buildings within the red line range of the Project, mainly including framework-structure houses, brick-concrete houses, brick-wood houses, simple houses, etc. According to the proprietary rights of the buildings, they may be classified as private buildings and buildings of enterprises and institutions. According to the purposes of the buildings, they may be classified as private dwelling, houses used by enterprises and institutions, shops, and etc. (iv) Affected attachments to the ground. Attachments to the ground within the red line range of the Project, mainly including pools, fences, wells, tombs, fruit trees, terraces, and etc. (v) Affected public facilities. Public service facilities within the range of project effect. (vi) Affected family households. Any family household with land, buildings and attachments to the ground within the red line range of the project or affected directly by the Project. (vii) Affected communities. Any community with land, buildings and attachments to the ground within the red line range of the project or affected directly by the Project. (viii) Affected enterprises and institutions. Any enterprise or institution with land, buildings and attachments to the ground within the red line range of the project or affected directly by the Project. (ix) APs. All members of the affected family households and affected enterprises and institutions. (x) Affected laborers. Laborers working in the affected shops, enterprises or institutions or engaging in agricultural production on the land for acquisition. (xi) Affected leaseholders. All persons leasing affected buildings for living or business operation based on the contracts. (xii) Vulnerable groups. Vulnerable groups are those who are more severely impacted by a project than others due to their poverty, gender, ethnicity, religion, language, lack of ownership or title to land, etc., and social groups in the

residents that are easy to be harmed, lack capability of responding to social changes, and stand in the unfavorable status due to their weak social participation capability, social security, disability, poverty and others, mainly including solitary and widowed elder, female single-parent family, orphan, poor family, handicapped person and patient, and etc. (xiii) Non-registered structures. Any structure built before the cut-off date, which was not approved by relevant administration agencies officially. (xiv) Illegal structures. Any structures built in the project area without official approval according to relevant regulatory procedures after the cut-off date.

2.2 Project Impact Survey

26. Based on the scope of land acquisition determined in the FSR, DPMO has mobilized affected town, village committees, and statistical investigation team to conduct an overall survey which includes the quantity of affected persons, houses, land, and other facilities. This survey is based on FSR. The RP would be revised and finalized based on project construction/detailed design. In order to analyze the social impacts and make a feasible RP, from December 2010 to January 2011, with the help of DPMO and affected village committees, the RP preparation agency (Gansu Taohe Civil Work Design and Consulting Company) and Anding District Statistical Investigation Team conducted a socioeconomic survey. The survey consisted of the present situation of the affected areas, which includes 398 households in four (4) villages of Fengxiang Town, and the impact scope of the Project on local society and economy. After the construction scope was modified, another survey involving 119 households in 2 villages was conducted in December 2010. The goals of the survey were: (i) have a basic understanding of socioeconomic situation and development planning affected by land acquisition and house demolition (based on data from local government plans, statistical, and agricultural sections. The data included GDP, agricultural revenue, price data, farmland data, and etc.); (ii) Gain a general idea of the potential impact on individuals according to statistical reports of affected villages and sample surveys; and (iii) Provide a part of baseline for the monitor and assessment of resettlement during the implement of the Project. 27. The contents of resettlement survey are divided into three parts as follows: (i) Literature survey (a) Statistics of social economy of Dingxi City and the project area; and (b) Laws and regulations related to LAR of the State, Gansu Province and Dingxi City. (ii) Social and economic background survey (a) Survey of basic circumstances of the affected families and vulnerable families in the area affected by the Project; (b) Public opinions and suggestions; and (c) Survey of basic circumstances of the affected villages‘ population, labor force, industrial structure and cultivated land, etc. (iii) Survey of affected objects in LAR (a) Circumstance of land acquisition: location, category and area; (b) Relocated buildings and other attachments to the land: location, category, quantity and property rights; (c) Category and quantity of various public facilities; and 13

(d) Basic circumstances and affected situation of self-employed households. 28. Based on the survey and consultation with the village committees, representatives of affected households, and local relevant government departments, the date of December 31, 2010 is set as the cut-off date of existing physical status in the affected areas. The village committees have announced the potential project construction and affected area as well as relevant regulations to the villagers. Any addition of new structures will not be considered for compensation.

2.3 Project Impacts

29. The basic data of the project impact includes 11 village groups and 4 villages in Fengxiang Town will be affected. In total, 988.57 mu of land will be acquired permanently, among which 589.02 mu are farmland, 123.54 mu are housing land, and 62 mu are state-owned. 323 households and 1,419 persons in total will be affected due to the land acquisition. In the construction period, 60 mu of land will be occupied temporarily. The total area of buildings to be demolished is 39,714 m2, in which 34,729 m2 are residence. 121 households and 472 persons in total will be affected due to the house relocation. 27 small businesses and 51 employees will be affected by relocation, in which the total affected building area is 4,986 m2. Totally, affected households will be 398 and APs will be 1,693; all have rural registration in the affected villages.

2.4 Impacts of Land Acquisition

2.4.1 Land Acquisition

30. The total area of land to be acquired for the Project is 988.57 mu, which includes 589.02 mu of farmland, 123.54 mu of housing land and 62 mu of the state-owned. The detailed information is shown in Table 2-1.

Table 2-1: Land Acquisition of the Project (mu)

State-owned Collective-owned Road Name Village Total Land Farmland Housing Wasteland Bailin, Jiaotong Rd. Donghe, 62 148.92 60.56 67.33 338.80 Beiershipu Bailin, Xihuang Rd. 0 146.65 25.44 128.63 300.72 Xiershipu Xincheng Avenue III and Bailin 0 135.61 0.00 8.64 144.25 bridges South Beian Rd. Bailin 0 39.24 0.00 1.12 40.36 Middle Beian Rd. Bailin 0 38.15 0.26 0.79 39.20 North Beian Rd. Bailin 0 14.63 19.77 3.09 37.49 North Anding Rd. Bailin 0 65.82 17.51 4.42 87.75 Total 62 589.02 123.54 214.01 988.57

31. The average land loss for 323 households is 21.1%. Among them, the average land loss for 67 HHs or 20.7% of the total affected households will be less than 10%, which is 7.87%; 209 HHs or 24.5% will have their land loss between 10 to 30%, averaging 15.7%; 47 HHs or 14.6% will have their land loss between 30 to 70%, averaging 37.6%. Two HHs will

have their land loss between 50 to 70%, the most land loss will be 65%. With such land loss, averagely, they still have about 8.38 mu of farmland per household. Average income from farming accounts for 35.2 to 45.9% (see Table 3-16). In terms of the impact of land loss on potential income, the potential income loss for those 67 HHs with land loss less than 10% will be less than 2.73%; and for those 209 HHs with land loss between 10 to 30%, their potential income loss will be ranged from 2.63 to 5.58%; for those 67 HHs with land loss between 30 to 70%, their potential income loss will be ranged from 5.66 to 14.4%. For those households with land loss more than 10%, detailed rehabilitation measures have been proposed and included in Section 6.5.2. The collective-owned land affected by the Project is presented in Table 2-2. Farmland changes before and after the land acquisition are presented in Table 2-3.

Table 2-2: Collective-owned Land, Village Groups, Households, Persons Affected by the Project

Farmland Land Farmland Farmland Total Farmland Farmland Affected Affected Acquired Acquired Village Group Total HHs Population Per Acquired Farmland per HH Acquired HHs Persons per Proportion Capita. per HH Capita per Group mu HH person mu/HH mu/person mu HH person mu/HH mu/person % 1 319.8 41 166 7.8 1.9 22.84 15 72 1.5 0.3 7.1 2 630 71 283 8.9 2.2 44.74 40 185 1.1 0.2 7.1 5 384 35 155 11.0 2.5 70.54 26 120 2.7 0.6 18.4 Bailin 6 and 7 1453 131 586 11.1 2.5 304.86 159 668 1.9 0.5 21.0 8 669 56 259 11.9 2.6 34.20 16 76 2.1 0.4 5.1 10 349 55 200 6.3 1.7 38.36 30 135 1.3 0.3 11.0 12 317 40 144 7.9 2.2 3.73 2 9 1.9 0.4 1.2 Beiershipu Xieheping 533 56 242 9.5 2.2 2.55 3 13 0.9 0.2 0.5 Donghe Shilipu 492 73 296 6.7 1.7 36.70 17 78 2.2 0.5 7.5 Xiershipu Baozihe 562 53 290 10.6 1.9 30.50 15 63 2.0 0.5 5.4 Total 5708.8 611 2621 9.3 2.2 589.02 323 1419 1.8 0.4 10.3

Table 2-3: Farmlands Before and After Land Acquisition

<10% 10–30% 30–70% Affected Farmland Farmland Affected Farmland Farmland Affected Farmland Farmland Village Group HHs before LA after LA HHs before LA after LA HHs before LA after LA HHs mu mu HHs mu mu HHs mu mu 1 2 18.4 16.92 13 122.3 100.95 0 0 0 2 21 213.6 199.40 16 167.3 148.26 3 31.2 19.70 5 0 0 0 19 215.4 175.06 7 81.2 51.00 Bailin 6 and 7 32 362.4 331.90 98 1118.5 965.44 29 330.2 208.90 8 1 12.3 11.45 13 153.2 129.53 2 24.3 14.62 10 7 52.1 47.43 20 156.4 131.21 3 23.2 14.70 12 0 0 0 2 20.3 16.57 0 0 0 Beiershipu Xieheping 1 6.3 5.75 2 13.2 11.20 0 0 0 Donghe Shilipu 3 21.5 19.72 12 88.6 62.30 2.0 15.3 6.68 Xiershipu Baozihe 0 0 0 14 123.7 96.50 1.0 8.8 5.5 Total 67 686.6 632.6 209 2178.9 1837.0 47 514.2 321.1

32. For affected households with average farmland in 6 to 8 mu per HH, 10 HHs will lose their farmland less than 10%; 32 households will lose their farmland between 10 to 30%, 2 households will lose their farmland between 30 to 70%. For affected HHs with average farmland in 8 to 9 mu per HH, 21 households will lose their farmland smaller than 10%; 47 HHs will lose their farmland between 10 to 30%; 6 HHs will lose their farmland from 30 to 70%. For affected households with average farmland in 9 to 12 mu per HH, 36 households will lose their farmland smaller than 10%; 130 households will lose their farmland between 10 to 30%; 39 households will lose their farmland between 30 to 70%. The distribution of the affected households is presented in Table 2-4.

Table2-4: Proportion Distribution of Affected HHs with Different Farmland Area

6–8 (mu) 8–9 (mu) 9–12 (mu) Total Village Group <10% 10–30% 30–70% <10% 10–30% 30–70% <10% 10–30% 30–70% <10% 10–30% 30–70% HHs HHs HHs HHs HHs HHs HHs HHs HHs HHs HHs HHs 1 0 2 0 2 11 0 0 0 0 2 13 0 2 2 0 0 12 11 0 7 5 3 21 16 3 5 0 0 0 0 2 0 0 17 7 0 19 7 Bailin 6 and 7 0 0 0 4 3 2 28 95 27 32 98 29 8 0 0 0 0 0 0 1 13 2 1 13 2 10 4 10 0 3 10 3 0 0 0 7 20 3 12 0 0 0 0 2 0 0 0 0 0 2 0 Beiershipu Xieheping 1 0 0 0 2 0 0 0 0 1 2 0 Donghe Shilipu 3 12 2 0 0 0 0 0 0 3 12 2 Xiershipu Baozihe 0 8 0 0 6 1 0 0 0 0 14 1 Total 10 32 2 21 47 6 36 130 39 67 209 47

33. The average per capita land holding will be reduced from 2.38 mu to 1.97 mu by 17% in average. The remaining farmland of affected villagers after the land acquisition is at least 1.14 mu per capita, as presented in Table 2-5. All of affected farmers still have land to plant and continue their agriculture production.

Table 2-5: Per Capita Farmland of APs before and after Land Acquisition

Land per Land per Land Area Land Area Acquired Capita Capita APs before after Land before after Village Group Acquisition Acquisition Acquisition Acquisition person mu mu mu mu/person mu/person 1 72 140.70 22.84 117.87 1.95 1.64 2 185 412.10 44.74 367.36 2.23 1.99 5 120 296.60 70.54 226.06 2.47 1.88 Bailin 6 and 7 668 1,811.10 304.86 1,506.24 2.71 2.25 8 76 189.80 34.20 155.60 2.50 2.05 10 135 231.70 38.36 193.34 1.72 1.43 12 9 20.30 3.73 16.57 2.26 1.84 Beiershipu Xieheping 13 19.50 2.55 16.95 1.50 1.30 Donghe Shilipu 78 125.40 36.70 88.70 1.61 1.14 Xiershipu Baozihe 63 132.50 30.50 102.00 2.10 1.62 Total 1,419 3,379.70 589.02 2,790.68 2.38 1.97

34. In all affected adults (over 18 years old), 38.79% of males and 31.95% of females engage in agricultural production. 29.66% of males and 32.05% of females engage in private or temporary business (including the temporarily jobless). Age, education and occupation of APs are presented in Table 2-6.

Table2-6: Age, Education and Occupation of APs by LAR

Female （%） Male（%）

0-9 19.59 18.47 10-19 19.77 23.33 20-29 17.83 18.21 30-39 16.61 15.71 40-49 15.16 13.62 Age 50-59 5.91 4.6 60-69 3.92 3.94 > 70 1.21 2.12 Total affected 836 886 population Illiteracy 3.8 16.2 Primary school 41.3 36.8 Education Junior High 28.3 27.9 Senior High 17.1 12.9

Female （%） Male（%）

Above Senior High 9.5 6.2 Total affected 836 886 population Worker 3.32 2.46 Farmer 50.54 54.79 Student 13.53 12.44 Self-employed laborer 2.35 1.72 State-owned unit 0.46 0.23 employees Occupation Part time worker 21.25 20.39

Retired（with Pension） 1.39 0.49 Employed 5.45 5.55 Others 1.71 1.93 Total 836 886

2.4.2 Temporary Land Occupation

35. The Project will occupy 60 mu of temporary land. The sites and the ownership of the land to be occupied will be determined when the project construction is commenced. The wasteland will be selected as the temporary land for the Project.

2.5 Affected Buildings

2.5.1 Affected Residential Buildings

36. The total area of residential buildings to be demolished for the Project is 34,729 m2, affecting 121 households (472 persons) of rural residents. Table 2-7 presents the details.

2.5.2 Affected Buildings of Small Businesses

37. The Project will affect 27 self-employed households (all are private) and 51 employees, with a total land area of 8,525 m2 and a total building area of 4,986 m2 and a total land area of 8,525 m2. All land is collective housing land. Table 2-8 presents the details. 2 out of 27 small businesses have been closed down.

Table 2-7: Residential Buildings to Be Demolished

House Earth Temporary HHs Population Housing Land Area Building Brick-concrete Brick-wood -wood Buildings Village Group Area HH person m2 mu m2 m2 m2 m2 m2 1 4 18 2,214 3.32 1,356.7 1,057 0 0 300 2 1 4 567 0.85 312 312 0 0 0 5 0 0 0 0.00 0 0 0 0 0 Bailin 6 and 7 39 119 25,840 38.74 7,397 7,277 120 0 0 8 11 50 6,030 9.04 2,162 763 873 526 10 5 13 4,130 6.19 2,873 2,873 0 0 0 12 23 101 14,441 21.66 8,060 6,851 1,209 0 0 Beiershipu Xieheping 20 88 12,093 18.13 6,852.1 6,852.1 0 0 0 Donghe Shilipu 10 43 6,947 10.42 4,510 3,833.5 676.5 0 0 Xiershipu Baozihe 8 36 10,138 15.20 1,206.6 1,206.6 0 0 0 Total 121 472 82,399 123.55 34,729 31,025 2,879 526 300

Table 2-8: Affected Small Businesses

Area of Number of Area of Part Operation Annual Average Business Land Employees Full Time Total Village Houses Time Status Revenue Wage Name Occupation Male Female (m2) (m2) person person person person person CNY10,000 CNY/MM Mill A 113 113 1 1 1 Operating 1.7 1,200 Mill B 85 85 1 1 1 Operating 1.4 1,000 Welding 34 34 1 1 1 1 2 Operating 3.8 2,200 Plant Nongjiale 78 78 1 2 2 1 3 Operating 8 900 restauraunt Wangjin 24 24 1 1 1 1 2 Operating 7.2 500 Grocery Daliy 32 32 1 1 1 Operating 8 1,100 Grocery Post Office 18 18 1 1 1 Operating 14 800 Noodles 30 30 2 1 1 2 Operating 9 650 factory China 20 20 1 1 1 1 2 Operating 12 700 Mobile provender 50 50 1 1 1 1 2 Operating 21 1,300 mill Waste 428 60 1 1 1 1 2 Operating 22 1,500 Recycle Steel 380 120 4 1 2 3 5 Operating 30 1,300 wholesale Yangji Oil 80 80 1 2 1 2 3 Operating 12 1,000 Mill Flour Mill 260 110 1 3 1 3 4 Operating 23 800 Xinyu Oil 104 104 1 2 1 2 3 Operating 20 1,000 23

Area of Number of Area of Part Operation Annual Average Business Land Employees Full Time Total Village Houses Time Status Revenue Wage Name Occupation Male Female (m2) (m2) person person person person person CNY10,000 CNY/MM Tianyi 22 22 2 1 1 2 Operating 12 1,500 Grocery Shang shoe 10 10 1 1 1 Operating 1 70 shop Flour shop 20 20 1 1 1 Operating 6 100 Zhenghua 40 40 1 1 2 2 Operating 12 1,800 ceramics Starch Closed 2,562 1,588 0 Factory down Shipalipu Closed 1,409 859 0 Flour Mill down Shulan 60 60 2 2 2 Operating 13.6 1,700 Grocery Lvyintang 563 109 1 1 1 1 2 Operating 17 2,000 Silk noodles Meimei store 24 24 1 1 1 Operating 8 1,000 Total 8,525 4,986 20 31 32 19 51 303.9

2.5.3 Affected Temporary Buildings

38. There are 300 m2 of temporary buildings in total, which are included into the total affected building area. DMG will compensate these temporary buildings according to the relevant compensation policy of Dingxi City. In the affected region there are no households whose buildings are all temporary buildings. All temporary buildings are attachments to the main houses.

2.5.4 Affected Attachments

39. The attachments affected by the Project include 81 poles, 8 electricity transformers, 2,012 trees, 320 phone relocation, and 52 Internet cable users. The details are presented in Table 2-9. Table2-9: Affected Attachments

Item Quantity Poles 81 Transformers 8 Trees 2,012 Phone 320 Cable user 52

2.6 Affected Vulnerable Groups

2.6.1 Identification of Affected Vulnerable Groups

40. Vulnerable groups refer to persons who are easy to be hurt and difficult to adapt to the changes brought by the project construction. Vulnerable groups are mainly divided as follows: (i) Lonely elder. The single elder who is over 65 years old and without a person fulfilling the statutory duty of maintenance. (ii) Single-parent family. The head of the family is single and has underage child. (iii) Orphan. The children without parents and younger than 16 years old. (iv) Poor family. The urban families under the minimum living guarantee line (MLGL), and rural poor households that have been specially determined. (v) The disabled. The persons, in psychology, physiology or body constitution, having some tissue or function lost or off-normal, or the ability of participating in some activity in the normal way lost totally or partially (subject to holding the Disabled Person Certificate of the People‘s Republic of China). And (vi) Other families having special difficulties. 41. The determination of vulnerable groups is carried out in accordance with relevant policies and regulations, and results of the field survey. In the implementation process, the RO will confirm it through door-to-door interviews, neighboring interviews and proving of community resident committee. 42. After the investigation and confirmation, it is not found that ethnic minority families will be affected by the Project. 25

2.6.2 Affected Families of Vulnerable Groups

43. According to the survey, there are 32 vulnerable families with 107 members to be affected by the Project (8% of the AHs). The families have members suffering from diseases, or have disabled persons, or have no or few incomes. These 32 vulnerable families include: 17 low income, 2 disabled, 2 elder living alone, and 11 single parents. Their distribution and family status is presented in Table 2-10. Four of them need to be relocated, while others are affected by land acquisition.

Table 2-10: Affected Vulnerable Families

Type HHs Persons Village Group No. HHs Affected by Bailin 1 3 House Bailin 2 2 House Single parent 11 69 Bailin 5 3 Farmland Beiershipu Xieheping 3 Farmland Bailin 5 5 Farmland Bailin 6 3 Farmland Low income 17 30 Bailin 10 5 House Bailin 12 4 House Bailin 7 1 Farmland Disabled 2 6 Bailin 8 1 Farmland Bailin 1 1 Farmland Alone elder 2 2 Xiershipu Puzihe 1 Farmland Total 32 107 32

III. SOCIOECONOMIC SURVEY

3.1 General Introduction of Socioeconomic Development of the Affected Regions

3.1.1 Population

44. Dingxi City is located in the middle of Gansu Province, with altitude of 1,640–3,941 meters (m) and annual precipitation of 300–500 millimeters (mm). The city consists of one district and six counties, which are Anding District; and counties of Tongwei, Longxi, Weiyuan, Lintao, Zhang, and Min. The total population in 2010 was 2.94 million. The total land area is 20,330 km2. There are 0.47 million people living Anding District, the Project Area. More details are presented in Table 3-1.

Table 3-1: Population of District and Counties of Dingxi (2009)

Population Land Area Total Population Urban Population Areas density (km2) (10,000 persons) (10,000 persons) (person/km2) Dingxi City 20,330 294.13 40.71 144.68 Anding District 4,225 47.08 10.55 111.43 Tongwei County 2,899 45.8 5.22 157.99 Longxi County 2,657 48.66 7.84 183.14 Weiyuan County 2,034 34.78 3.4 170.99 Lintao County 2,851 54.2 6.42 190.11 Zhang County 2,164 19.2 2.03 88.72 Min County 3,500 44.41 5.25 126.89

Source: Dingxi Statistical Yearbook 2010

3.1.2 Socioeconomic Development of Anding District

45. Anding District administrates 2 street administrative offices, and 19 townships. The net income per capita of rural resident in Dingxi and Anding in 2009 were CNY2,380 and CNY2,397, respectively. The disposable income per capita of urban resident in Dingxi and Anding were CNY9,858. More details are presented in Table3-2. 27

Table3-2: Economic indicators of Dingxi City and Anding County in 2010 Dingxi City Anding County year-on-year year-on-year Proportion unit value value increase (%) increase (%) in Dingxi (%) Population 10,000 294.13 — 47.08 — GDP 10,000 1,319,394 10.3 270,873 10.4 20.53 Net income of rural CNY 2,380 11.4 2,397 11.3 — resident Disposable income CNY 9,858 8.66 9,858 8.7 — of urban resident

Source: Dingxi Socioeconomic Statistical Yearbook 2010 46. Anding District is the seat of DMG, and the city‘s political, economic and cultural center. Anding District was named ―Potato Hometown in China‖ in 2001. 47. Anding District is rich in labor forces. Of all 0.47 million population, there are 0.28 million labors, 28% of which are above junior-high-school level.

3.2 General Situation of Affected Villages

48. The Project affects 11 village groups and 4 villages in Fengxiang Town. In 2009, income per capita of rural residents of Fengxiang Town was CNY6,597, of which agricultural incomes accounted for 42.3%. Rural population accounted for 97% of the general population in the town. More details are presented in Table3-3.

Table 3-3: General Situation of Fengxiang Town

Item Value Community/village 27 Area (square kilometer) 40.83 Household (HH) 11,007 Population (person) 46,135 Male (person) 23,739 Female (person) 22,396 Rural Population (person) 44,688 Proportion of Rural population (%) 97 Rural Labors (person) 23,150 Male Labors (person) 11,716 Farmland (mu) 133,177 Per Capita Farmland (mu/person) 2.98 Per capita income (CNY) 6,597 49. The Project affects four villages of Bailin, Donghe, Beiershilipu and Xiershipu of Fengxiang Town. Per capita farmland in these four villages is 3.16 mu, 1.78 mu, 4.06 mu, and 5.1 mu for Bailin, Donghe, Beiershilipu, and Xiershipu, respectively. Agricultural income accounts for 42% of total income in average, while non-agricultural income accounts for 58%. Most of non-agricultural income is from salary work out of villages. The general situation of affected villages is presented in Table 3-4.

Table 3-4: General Socioeconomic Situation of the Affected Villages

Per Agricultural Wage Other Total Income Agricultural Account Wage Account Other Farmland HHs Population Capita Income Income Income Revenue Per HH Income for Income for Income Village Farmland Per HH Per HH per HH mu HH person mu/person CNY10,000 CNY10,000 CNY10,000 % CNY10,000 CNY10,000 % CNY10,000 CNY10,000 CNY10,000 Bailin 7,118.1 541 2,256 3.16 1,026.2 1.90 422.9 41.2 0.78 564.2 55.0 1.04 39.1 0.07 Donghe 2,607.1 278 1,462 1.78 712.3 2.56 293.6 41.2 1.06 410.2 57.6 1.48 8.5 0.03 Beiershilipu 3,914.3 231 964 4.06 421.3 1.75 182.6 43.3 0.76 232.8 55.3 0.97 5.9 0.02 Xiershipu 6,832.8 336 1,339 5.10 1,032.1 3.07 432.1 41.9 1.29 588.3 57.0 1.75 11.7 0.03

3.3 Sample Survey

50. In order to understand more about the basic information of the affected residents, and to analyze the impacts of the Project on local people, the DUCIAM conducted a sample survey of affected HHs in affected villages.

3.3.1 Sample Selection

51. 119 households were selected, which account for 30% of total affected households. Two sampling villages are selected, which account for 50% of total affected villages. 119 sample questionnaires were issued, actual questionnaires were surveyed and 108 were valid. The samples are presented in Table 3-5.

Table 3-5: Distribution of Sampling Households

Sampling Proportion Sampling HHs Affected HHs Proportion Town Villages

% HHs HHs % Fengxiang 2 50 119 398 29.9 Total 2 50 119 398 29.9

3.3.2 Basic Characteristics of Sampling Households

52. 448 persons or 108 HHs were surveyed. The average family size was 4.1 persons. Per HHs farmland in Bailin and Xirershipu villages were 7.74 mu and 7.83 mu, respectively. More population information is presented in Table 3-6-1. More agricultural and assets information is presented in Table 3-6-2. Income and expenditure information is presented in Table 3-6-3. The willingness of compensation for LAR is presented in Table 3-6-4. Legal residence right of affected HHs is presented in Table 3-7.

Table 3-6-1: Population and Residential Situation of the Sampling HHs

Bailin Xiershipu Type Unit Total Per HH Total Per HH HH basic data Samples HH 105 1 3 1 1.Population person 436 4.15 12 4 of which：Males person 227 2.16 7 2.33 ≤18years person 121 1.15 4 1.33 ≥65years person 132 1.26 3 1

2.Labors（18–60years） person 183 1.74 4 1.33 3.Area of house m2 37,820 360.19 812 270.67 4.Ethnic Minorities HH 0 0 0 0 HH 16 1 5. Low income HHs person 64 1 HH 2 0 6.Disabled HHs person 3 0 7.Alone elders HH 2 0

Bailin Xiershipu Type Unit Total Per HH Total Per HH person 2 0 Source: The IA and the RP preparation agency (similarly hereinafter) Note：108 sampling HHs, family size is 4.1, average house area is 357.7 m2.

Table 3-6-2: Agricultural Production and Assets of Sampling HHs

Bailin Xiershipu Type Unit Total Per HH Total Per HH I. Agriculture 1.farmland mu 812.5 7.74 23.5 7.83 (i) irrigated land mu 812.5 7.74 23.5 7.83 (ii) dry land mu 0 0 0 0 (iii) wasteland mu 0 0 0 0 2.Crops mu (i) grain crops mu 723.2 6.89 18.5 6.17 (ii) fruits mu 32 0.3 1 0.33 (iii) vegetables mu 6.6 0.06 3.5 1.17 (iv) other mu 50.7 0.48 0.5 0.17 II. Family Assets 1.Electrical Appliances (i) TV set 115 1.1 7 2.30 (ii) refrigerator 72 0.69 2 0.67 (iii) washer 90 0.86 2 0.67 (iv) other 42 0.4 3 1 2.Viechles (i) van (ii) car 1 0.01 (iii) tractor 49 0.47 (iv) motorcycle 59 0.56 2 0.67 (v) other Notes：108 sampling HHs with farmland per HH is 7.7mu. 31

Table 3-6-3: Family Income and Expenditure of Sampling HHs

Bailin Xiershipu Type Per Per Per Total Total Per HH HH Capita Capita 10,000 I. Annual revenue 200.7 1.91 0.46 6.95 2.32 0.58 CNY 10,000 1.Wage 113.88 1.08 0.26 2.09 0.83 0.17 CNY 10,000 2.Agricultural 84 0.8 0.19 4.46 1.49 0.37 CNY 10,000 3.Lease 1.6 0.02 0.004 CNY 4.Self employment 10,000 1.1 0.01 0.003 business CNY 10,000 5.Poverty allowance 0.12 CNY 10,000 6.Other CNY II. Agricultural CNY/mu 5,428 3,145 Income

Of which：1.grain crops CNY/mu 903 962 2.Fruits CNY/mu 2,152 2,132 3.Vegetables CNY/mu 6,321 7,605 4.Other CNY/mu 2,821 2,923 III. Annual 10,000 166.7 1.59 0.38 9.7 2.23 0.81 expenditure CNY 10,000 1. Daily life 106.1 1.01 0.24 6.2 1.07 0.52 CNY 10,000 2.Housing 17.2 0.16 0.04 1.1 0.37 0.09 CNY 10,000 3. Education 10.7 0.1 0.02 0.6 0.2 0.05 CNY 10,000 4.Medical service 4.3 0.04 0.01 0.3 0.1 0.03 CNY 10,000 5. Other 28.4 0.27 0.07 1.5 0.5 0.13 CNY Note: 108 sampling HHs with agricultural income Per HH is CNY7,800, accounting for 39.7% of total income.

Table 3-6-4: Sampling HHs’ Willingness to Use Compensation

Bailin Xiershipu Type Unit Total Total 1. Replied to ―Method of Compensation for HH 105 3 House‖ (i) Replacement of the existing residential area % 76.9 46.2 with the same size (ii) Rebuild new house % 15.4 46.2 (iii)Purchase new house % 7.7 7.7 2. Replied to ―Use of LAR compensation‖ HH 105 3 (i) Invest in Agriculture % 3.3 0.8 (ii) Run business % 0 0.4 (iii) Self employment business % 18.3 13 (iv) Deposit % 11.7 18.6 (v) Purchase or build new house % 45.8 31.5 (vi) Daily consuming % 10.8 22.4 (vii) Purchase social insurance % 5 6.5 (viii) Other % 5 6.9

53. According to the survey for Willingness of LAR compensation, most of the surveyed HHs accepted the government‘s offer to build them new houses; in Bailin village this figure is 76.9%. The HHs tend to rebuild their houses by using the monetary compensation; in Bailin village, this figure is 45%.

Table 3-7: Residential Right of Sampling HHs

Type HHs HHs Proportion HHs or persons Total HHs 108 100% 448 Of which registered 108 100% 448 Unregistered 0 0% 0

Not confirmed 0 0% －

Family size －－ 4.1

54. Since the proportion of vulnerable households is relatively little, in order to have a more precise understanding of affected vulnerable families, a specifically enlarged sample survey has been conducted. There were 24 vulnerable families being surveyed, which accounted for 22.2% of the total samples. Among them, there were 17 low-income HHs, which accounted for 15.74% of the total samples; 2 disabled HHs accounted for 1.85%; 2 alone elders HHs accounted for 1.85; 3 single-parent HHs accounted for 2.78%. More details are presented in Tables 3-8-1 to 3-8-2. 33

Table 3-8-1: The Situation of Vulnerable Group

Type HHs Percentage Population

Low-income 17 15.74% 65 Disabled 2 1.85% 3 Alone elders 2 1.85% 2 Single-parent 3 2.78% 8

Table3-8-2: Vulnerable Groups’ Willingness to Use Compensation fund

Type Bailin Xiershipu 1. Replied to ―Method of Compensation for House‖ HH 14 3 (i) Replacement of the existing residential area with 78.6 66.7 the same size % (ii) Rebuild new house % 7.1 0 (iii) Purchase new house % 14.3 33.3 2. Replied to ―Use of LAR Compensation‖ HH 14 3 (i) Invest in Agriculture % 0 0 (ii) Run business % 0 0 (iii) Self employment business % 7.1 0 (iv) Deposit into bank % 35.7 33.3 (v) Purchase or build new house % 28.6 0 (vi) Daily consuming % 7.1 33.3 (vii) Purchase social insurance % 7.1 33.3 (viii) Other % 14.3 0

55. In the survey, most of the interviewees were the heads of the HHs or their spouses. More details are presented in Table 3-9.

Table 3-9: The Relation between Interviewees and the Head of HHs

Identification Persons Percentage Head of HHs 58 53.70 Spouse 33 30.56 Children 5 4.63 Nephew or Niece 3 2.78 Grandchildren 1 0.93 Siblings 2 1.85 Son or Daughter in Law 4 3.70 Parents in Law 2 1.85 Total 108 100.00

56. 234 males accounted for 52.2% of total population in sampling HHs. Average duration of education of the persons in the sampling HHs was 7.8 years (males: 9.4 years, females: 6.5 years); 192 persons or 42.9% were over 36 years old. More details are presented in Table 3-10.

Table 3-10: Age, Gender, and Education of Sample Group

Male Female Total Age Quantity Proportion Education Quantity Proportion Education Quantity Proportion Education years person % year person % year person % year <=18 57 24.36 10 35 16.36 9 92 20.54 9.6 19–25 22 9.40 11.8 20 9.35 10.6 42 9.38 11.2 26–35 28 11.97 10.01 32 14.95 9.2 60 13.39 10.25 36–45 46 19.66 8.6 45 21.03 8.1 91 20.31 8.4 46–55 33 14.10 9.8 32 14.95 7.9 65 14.51 8.7 56–65 24 10.26 8.3 30 14.02 5.6 54 12.05 6.9 >=66 24 10.26 5.1 20 9.35 3 44 9.82 4.2 Total 234 100.00 9.4 214 100.00 6.5 448 100.00 7.8

3.3.3 Income Situation of Affected Households

57. The average total annual income per HH of sampling HHs were CNY21,500 and 26,200, respectively in 2009 and 2010. The average annual expenditure per HH were CNY19,600 and 20,300, respectively, in 2009 and 2010. Respectively, 64.97 and 64.14% of the surveyed HHs had their average annual income per capita between CNY1,000 to 5,000. About 5% were lower than CNY1,000 per capita. 20% of the surveyed HHs had their average annual income per capita between CNY5,000–10,000. More details and expenditure distribution are presented in Table 3-11.

Table 3-11: Income and Expenditure distribution in 2009 and 2010

Income Proportion (%) Expenditure Proportion (%) Index Unit 2009 2010 2009 2010 ≤1,000 CNY 5.49 5.06 1.69 2.11 1,000–3,000 CNY 40.09 34.17 26.16 16.87 3,000–5,000 CNY 24.89 29.96 34.60 29.96 5,000–7,000 CNY 11.39 12.66 12.66 25.32 7,000–10,000 CNY 13.50 11.81 12.66 12.66 10,000–20,000 CNY 2.53 4.22 10.13 12.66 ≥20,000 CNY 2.11 2.11 2.11 0.42

58. The average total annual expenditure per capita were mainly between CNY1,000 to 5,000, accounted for 60.76 and 46.84%, respectively in 2009 and 2010. 2% of the sampling HHs were lower than CNY1,000. 12.66 and 25.32% of the surveyed HHs had their annual expenditure per capita between CNY5,000–7,000. About 10% of the HHs‘ annual expenditure per capita was between CNY10,000–20,000. 59. According to the average income data in 2010 of the sampling survey, 41% of their 35 income was from agriculture, 56% from wage income, 0.5% self-business, and 0.3% from property income. 60. In the two sampling villages, since they are living in the urban suburbs, the wage income accounted for more than agricultural income with urbanization of Dingxi City. The neighborhood of the Project area has been developing rapidly in the past few years. The land has been acquired constantly. The ratio of agricultural income to total income has been shrinking partly due to the constant reduce of average farmland per HH. The income structure of sampling HHs is presented in Table 3-12.

Table 3-12: Income Structure

Town Fengxiang Village Unit Bailin Xiershipu Sampling HHs HH 105 3 Total income CNY10,000 200.7 6.95 Wage income CNY10,000 113.88 2.09 Proportion % 56.74 30.07 Agricultural income CNY10,000 84 4.46 Proportion % 41.85 41.07 Property rent CNY10,000 1.6 Proportion % 0.8 Other income CNY10,000 1.1 Proportion % 0.55 Poverty Allowance CNY10,000 0.12 Proportion % 0.06

3.3.4 Expenditure Structure of Affected Households

61. Considering that big goods purchase will consume the savings of many years - like housing, decoration, medical, and education cost, the household expenditure is divided into two groups: one is daily expenditure; and another is other expenditure. The expenditure structure is presented in Table 3-13. Total expenditure includes daily expenditure, housing, medical service, education, and other non-daily expenditures. Daily expenditure includes foods, cigarette/alcohol/tea, laundry, clothes, water and electricity, energy, TV and phone, transportation, festival, and private expenditure - in total ten items. In general, daily expenditure accounts for more than 60% of total expenditure, which indicates that provision of food depends on purchases in market rather than self-production, and therefore rural residents share the same life style with their urban counterparts.

Table 3-13: Expenditure Structure (2010)

Village Bailin Xiershipu Per HH Percentage Per HH Percentage Item CNY % CNY % Daily Expenditure 6,700 40.9 7,000 32.4 Agricultural 3,500 21.3 3,700 17.1 production Housing/ 1,600 9.8 3,700 17.1 decoration Education cost 1,500 9.1 1,200 5.6 Medical cost 400 2.4 1,000 4.6 Other 2,700 16.5 5,000 23.1 Total 16,400 100.0 21,600 100.0

Note: Education Expenditure includes accommodations of students.

3.3.5 Building Structure

62. In 108 sampling HHs, houses for self-use accounted for 83.33%, for rent accounted for 2.78%, for both accounted for 13.89%. More details are presented in Table 3-14.

Table 3-14: Use of Housing

HHs Proportion Use HH % Self use 90 83.33 Rent 3 2.78 Self use and rent 15 13.89 Total 108 100.00

63. Total area of 108 sampling HHs‘ houses is 38,092 m2, averagely 352 m2 per HH and 85 m2 per capita. In all houses, 85.5% are brick-concrete, 9.3% are brick-wood, and 4.8% are earth-wood. Based on present price, they evaluated their house of CNY900 to 1,000 per m2. In the survey, 69.2% of the sampling HHs would like to be compensated by new housing; 30.8% would like cash.

3.3.6 Land Characteristics

64. In all samples, there are 836 mu of irrigated farmland, all of which are 34.4 mu or 4.1% of greenhouses, 12.55 mu or 1.5% of cypress, 4.35 mu or 0.52% of apricot seedling. In all farmlands, grain crops account for 88.7%, vegetables account for 3.9%, fruit trees account for 0.52%. More details are presented in Table 3-15. 37

Table 3-15: Planting Type of Affected Land

Area Proportion Income Type mu % CNY/mu Grain crops 741.7 88.72 905.5 Vegetables 33 3.95 6,766 Fruit trees 10.1 1.21 2,151.2 Other 51.2 6.12 2,826 Total 836 100.0

3.3.7 Impacts after LAR

65. The income loss for the affected HHs with land loss less than 10% will be between 2.6 to 4.0% (percentage of agricultural income loss in total income). The income loss for the affected HHs with land loss between 10 to 30% will be 4.4–10.6%. The income loss for the affected HHs with land loss between 30–70% will be 12.9–20.1%. Averagely, the proportion of land acquisition is 17.4%, while income loss proportion will be 6.6%. 26 affected households‘ income loss will be more than 10%. Impacts after LAR are presented in Table 3-16; and impacts of different LA proportions are presented in Table 3-17.

Table 3-16: Impacts after LAR

Proportion Agricultural Income per of Affected Farmland Acquired Proportion Income Income per APs Capita Agricultural HHs before LAR Land of LA Loss Village Group Capita Income CNY/person CNY/person % HH person mu mu % % 1 6,952.78 2,776 39.9 15 72 140.70 22.84 16.23 6.5 2 6,289.19 2,454 39.0 40 185 412.10 44.74 10.86 4.2 5 10,626.67 4,618 43.5 26 120 296.60 70.54 23.78 10.3 Bailin 6,7 8,501.80 2,993 35.2 159 668 1811.10 304.9 16.83 5.9 8 5,522.37 2,196 39.8 16 76 189.80 34.2 18.02 7.2 10 6,314.07 2,521 39.9 30 135 231.70 38.36 16.56 6.6 12 7,855.56 3,267 41.6 2 9 20.30 3.73 18.37 7.6 Beiershipu Xieheping 10,515.38 4,823 45.9 3 13 19.50 2.55 13.08 6.0 Donghe Shilipu 8,176.92 2,921 35.7 17 78 125.40 36.7 29.27 10.5 Xiershipu Baozihe 9,288.89 3,622 39.0 15 63 132.50 30.5 23.02 9.0 Total 7,882.00 2,990 37.9 323 1,419 3,379.7 589.016 17.43 6.6

Note: The loss means agricultural loss due to farmland reduction.

Table 3-17: Impacts of different LA proportion <10% 10-30% 30-70% Affected Proportion Income Affected Proportion Income Affected Proportion Income Village Group Households of LA Loss Households of LA Loss Households of LA Loss HH % % HH % % HH % % 1 2 8.04 3.2 13 17.5 7.0 0 0 0.0 2 21 6.65 2.6 16 11.4 4.4 3 36.9 14.4 5 0 0 0.0 19 18.7 8.1 7 37.2 16.2 Bailin 6 and 7 32 8.42 3.0 98 13.7 4.8 29 36.7 12.9 8 1 6.91 2.8 13 15.5 6.2 2 39.8 15.8 10 7 8.96 3.6 20 16.1 6.4 3 36.6 14.6 12 0 0 0.0 2 18.4 7.7 0 0 0.0 Beiershipu Xieheping 1 8.73 4.0 2 15.2 7.0 0 0 0.0 Donghe Shilipu 3 8.28 3.0 12 29.7 10.6 2 56.3 20.1 Xiershipu Baozihe 0 0 0.0 14 22.0 8.6 1 37.5 14.6

Total 67 7.87 3.0 209 15.7 6.0 47 37.6 14.3

3.3.8 Affected People’s Basic Understandings on LAR

1. Basic Understanding on Socioeconomic Development in Project Area 66. Most of the surveyed people were not satisfied with their present incomes. 70.52% of the interviewees were not satisfied with their incomes and their family‘s incomes. 71.37% of the interviewees thought their incomes were lower than their friends‘ or relatives. 81.54% of the interviewees considered their incomes haven‘t reached their expectations. More details are presented in Table 3-18.

Table 3-18: Opinions on Current Living Standards of Sampling HHs

Satisfaction Compared to Compared to Level of HH Happiness one’s own Friends Options Income Options Expectation % % % % 1. Very 24.79 2.97 1. Much lower 38.46 42.06 dissatisfied 2. Dissatisfied 45.73 28.81 2. A bit lower 32.91 39.48 3. Fair 16.67 48.31 3.Fair 23.93 12.02 4. Satisfied 11.97 16.10 4. A bit higher 4.27 4.72 5. Satisfied very 0.85 4.24 5.Much higher 0.43 1.72 much

67. The surveyed people were satisfied with current socioeconomic development, housing, and transportation situation. However, they are dissatisfied with their own and their family members‘ job opportunities, employment environment, and present occupations. They considered that the development emphasis of the Project should focus on the following five aspects: (i) employment improvement, (ii) residential housing construction, (iii) road network construction, (iv) urban area improvement, and (v) urbanization of suburb. It indicates that government and the general public share the idea of ―road network construction will improve regional development‖. Satisfaction of the project environment is presented in Table 3-19, ranking of socioeconomic dissatisfaction is presented in Table 3-20, while assessment of development emphasis in Anding District is presented in Table 3-21.

Table 3-19: Satisfaction of Project Environment

Very Satisfied Dissatisfied Fair Satisfied Compared to Other Urban Dissatisfied Very Much Areas in Dingxi City % % % % % Social-economic situation 6.38 20.85 27.23 40.00 5.53 Job opportunities 18.14 45.57 23.63 12.24 0.42 Employment environment 16.03 44.73 25.32 13.92 0.00 Rural transportation 7.59 19.83 30.38 37.55 4.64 My occupation 11.02 28.81 36.02 20.76 3.39 My house 7.59 5.49 18.57 45.15 23.21

Table 3-20: Ranking of Social-economic Dissatisfaction

Dissatisfaction Percentage Ranking % Undeveloped economy and service industry; Less job 26.13 1 opportunities Inconvenient transportation; poor road network 9.15 6 Undeveloped commerce, inconvenient shopping 18.02 3 Little contact with other cities, 13.93 4 Low speed development, great regional disparity 11.70 5 Low income, hard to do business 19.16 2 Other 1.91 7

Table 3-21: Assessment of Development Emphasis in Anding District

Development Emphasis Importance Ranking Residential housing construction 8.23 2 Road construction 9.13 1 Urban area improvement 7.03 6 Urbanization of suburb 7.38 5 Commerce development 8.04 3 Employment improvement 7.89 4 Pollution reduction 6.65 8 Public facilities improvement 6.89 7

Note: Importance is divided in to 10 levels, 0 is the least important, and 10 is the most important. 2. Assessment of Project Impact 68. 87.34% of the surveyed people considered that the economy and society will develop rapidly after the infrastructures are improved. The potential impact of urban transformation improvement in the project area is presented in Table 3-22. The interviewees considered that the Project will largely improve the transportation and living environment, and also contribute to self-development, employment, and education for children. Meanwhile, their income and living standard will be increased, but their housing, life style and habits might be affected negatively. 69. 26.68% of the surveyed people considered that LAR will affect their housing conditions. In general, their housing conditions have been improved due to the renovation in recent years. They reserve their views about LAR, and are concerned a bit. Especially the farmers over middle age, they are not used to living in apartments. They expect that the relocation buildings will be as spacious as their old houses with residence in front yard and breeding area in back yard. More details are presented in Table 3-22.

Table 3-22: Assessment of Project Impact

Advantageous No Disadvantageous Don’t Advantageous Disadvantageous Option Very Much Change Very Much know % % % % % % 1. to housing 16.26 22.09 12.77 10.51 16.17 22.20 conditions 2. to living 4.24 36.95 23.31 18.39 10.53 6.59 environment 3.. to job 3.39 29.49 30.93 7.95 7.83 20.41 opportunities 4.to income 2.95 18.66 40.81 13.41 12.78 11.39 5. to live style and 4.23 6.75 33.33 31.22 15.61 8.86 customer 6. to family 4.23 6.75 65.27 4.14 5.06 14.55 relationship 7. to education for 2.95 29.83 40.93 5.61 4.44 16.24 children 8. to transportation 21.75 39.83 24.15 4.71 3.51 6.05 9. to living standard 5.49 23.55 34.18 16.94 4.66 15.18 10. to self and family 2.95 15.19 36.22 6.88 6.24 32.52 future development

70. 56 or 51.85% of interviewees considered that LAR will improve their living standard; 17 or 15.74% of interviewees considered LAR will not affect their living standard; and 8 or 7.41% them considered LAR will decrease their living standard. The middle-aged or the older with low education level, shared the notion that LAR will affect them disadvantageously. This inevitably leads to the conclusion that living standard will be decreased without skill and land. More details are presented in Table 3-23.

Table 3-23: Opinions on Impact of LAR

Persons Percentage Impact person % 1. increase living standard very much 56 51.9 2. decrease living standard very much 8 7.4 3. not much 17 15.7 4. no change 14 13.0 5. no idea 13 12.0 Total 108 100

3. The Channel and Extent of the Understanding of the Project 71. 71.62% of the surveyed people learned that their houses and lands would be acquired through earlier investigation, pre-implementation preparation and LAR survey. About 60% of them had a rudimentary knowledge of the road improvement plan. More than 60% of them knew about some local LAR policies. In the period of implement, the DUCIAM, DMG, and relative towns and communities promoted people‘s understanding. It indicates in Table 3-24 that compensation rate, employment, and relocation are mainly concentrated by APs. Medical service and pension rank fifth and sixth. LAR ranks the fourth. After relocation, they 43 will keep enjoying the security policies like medical service and pension.

Table 3-24: Ranking the demands of LAR Policies

LAR Policies Degree of Concern Ranking 1.Pension 8.2 6 2.Medical Service 8.9 5 3.Minimum Social Safeguard 8.1 7 4.Employment Placement 9.1 4 5.House Compensation 9.6 2 6.Land Compensation 9.8 1 7.Relocation 9.5 3

72. Generally, APs expect a good relocation policy. 70% of the interviewees believed the government will take their benefits into account. In order words, they trust the government. 32.6% of the surveyed people held the view that the Project would honor the local government with solving the APs‘ housing and living problems. 18.4% of the interviewees doubted there might be problems during the period of Project implement. Still, they have faith in the project implement and relocation policies.

3.3.9 Impact on Ethnic Minorities and Gender

73. According to the survey, there were no ethnic minorities involved. Accordingly, there is no impact on ethnic minorities in this sub-project. 74. As for the impact on relocation, the residents will obtain better dwelling conditions. For the women bearing most of labor services of the families, the improvement of dwelling conditions and environment may reduce their labor burden and lessen the impact of unfavorable environments. In the social survey for the impact on gender, the males and females were both concerned about the problem of fairly compensation and timely compensation, especially the necessary help of rebuilding their houses. Compared with the males, the females showed more concern about employment, education of the children, subsidies and separation from children and relatives. 75. As the Project is an urban development project, the APs don‘t have to migrate to places far from their villages. The concerns of women about separation from their children and relatives do not exist. The different views of different genders are presented in Table 3-25.

Table 3-25: Gender Analysis

Items Male Female Addressed Major No-major Major No-major Justice of compensation yes yes Timely compensation yes yes Start a new transaction yes yes Reset for the cultivation yes yes of the land Loss of income yes yes Future employment yes yes

Children's education yes yes Subsidies during the yes yes reset period Separation of children yes yes and relatives

3.4 Assessment of Social Impact

76. For the APs by land acquisition. They live in the urban suburbs. Along with the progress of urbanization, a few farmers in Fengxiang Town have become urban residents in 2010. For the affected people, agricultural income accounted for 40% of their total income. Since no APs lost their all lands, the land loss effects are limited. The relatively high compensation from the Project will help them create a novel income opportunity in non-agricultural fields and increase their income level. 77. For the APs by relocation. The APs by relocation are farmers. According to Anding District Urbanization Plan, their villages will be urbanized gradually. The villagers will live together, which indicates that their old social relation will remain. In order to help these people adapt the urbanization process, the local government will provide employment training, and urban life guide service. 78. Women. In the Project area, women have the same right with men. There is no limitation, disparities, or discrimination. Women and men make family decisions after consultation with each other. In recent years, all levels of Women's Federation have held kinds of free training for women including new agricultural technology, catering, and service industry. A large number of women benefited from the training. The Project will not affect women adversely. From the employment and economic development of view, the status of women will be increased after the Project‘s accomplishment. 79. Vulnerable groups. the project area is located in the urban suburbs. There are very few poor people involved. According to relevant policies, the poor and other vulnerable groups will be taken care of. The relocation policies have taken into account vulnerable groups‘ needs, and will ensure the improvement of their lives. Some special measures will offer vulnerable groups priority. 45

IV. LEGAL AND POLICY FRAMEWORK

4.1 General

80. The preparation and implementation of resettlement for this Project follow the laws and regulations promulgated by the People‘s Republic of China (PRC) and Gansu Province, and also meet the requirements of ADB‘s relevant policies. The adopted unit rates of compensation standards and rehabilitation measures in the RP will also follow them during resettlement implementation. After detailed survey and measures, the RP will be updated in terms of final asset inventory and third-party assessment, and be submitted to ADB for review prior to award of civil works contracts.

4.2 Policy Basis

4.2.1 Relevant Laws and Provisions Enacted by the Central Government

81. The RP for this Project follows the laws and regulations promulgated by the PRC, including: (i) The Law of Land Administration of the PRC implemented in January 1999, and the revision implemented on August 28, 2004; (ii) The Rural Land Contracting Law of the PRC implemented since March 1, 2003; (iii) Law of the PRC on Urban Real Estate Administration taking effect on January 1, 1995; (iv) Regulations on Urban House Relocation and Compensation on state-owned land taking effect on January 21, 2011; (v) Guiding Opinions on Appraisal of Urban House Relocation taking effect on January 1, 2004; (vi) Law of the PRC on Urban Real Estate Administration taking effect on January 1, 1995; (vii) Decisions on Deepening the Reform and Intensifying Land Administration issued by the State Council on October 21, 2004; (viii) Circular of the State Council on Intensifying the Land Control issued on August 31, 2006; (ix) Real Right Law of the PRC taking effect on October 1, 2007; and (x) Provisions of the PRC on the Disclosure of Government Information taking effect on May 1, 2008.

4.2.2 Regulations and Policies Enacted by the People’s Government of Gansu Province

82. The RP for this Project follow the laws and regulations promulgated by Gansu Province, including: (i) Implementation Measures for the Land Administration Law of PRC in Gansu Province promulgated on September 2, 1999, revised and effective since March 30, 2002; (ii) Opinion of Gansu Provincial Government on Deepening Reform and Tightening Land Administration (Gansu Provincial Government Decree 48 of 2005) Promulgated in July 2005;

(iii) Notice of Delivering the ―Operating Procedures of the Minimum Standard of Living Security in Gansu Province‖ (Gansu Provincial Government Decree 36 of 2009); and (iv) Gansu Province Implementation Details for Cultivated Land Occupation Tax (revised in October 1997).

4.2.3 Regulations and Policies Enacted by the DMG

83. The RP for this Project follow the laws and regulations promulgated by Dingxi City, including: Regulation on Urban Housing and Relocation Administration taking effect on November 1, 2004.

4.2.4 ADB’s Policies on Involuntary Resettlement

84. The compilation of the RP and the implementation of resettlement work for the Project will be in accordance with the ADB‘s Safeguard Policy Statement (2009). The implementation of resettlement will strictly follow this policy, and its approval will be obtained from ADB prior to any change. If any significant changes in the project detailed design must be made, the Project Resettlement Office will discuss with the APs, and submit a final RP to ADB for review and concurrence.

4.3 Summary of Main Laws, Regulations, and Policies

4.3.1 Summary of Relevant National and Provincial Laws and Regulations

1. Provisions on Land Ownership and Land-Use Right 85. The PRC implements a socialist public ownership, i.e. an ownership by the whole people and ownerships by collectives of land. Land in urban districts shall be owned by the State. Land in the rural areas and suburban areas, except otherwise provided for by the State, shall be collectively owned by peasants including land for building houses, land and hills allowed to be retained by peasants. (Article 2 and 8 of the Law of Land Administration of the PRC) 86. In order to meet the demands of public interests, it is allowed to requisition lands owned collectively, houses owned by entities and individuals or other realties according to the statutory power limit and procedures. When requisitioning land owned collectively, it is required to, in accordance with law and in full amount, pay land compensation fees, placement allowance, compensations for the above-ground fixtures of the lands and seedlings and other fees, arrange for social security fees for the farmers with land acquired, guarantee their livelihood, and protect their lawful rights and interests. When requisitioning the houses owned by entities and individuals or other realties, it is required to compensate for demolishment and relocation in accordance with law and protect the lawful rights and interests of the owners of the acquired assets. When requisitioning the individuals' residential houses, it is required to guarantee the housing conditions of the owners of the acquired houses. (Article 42 of the Real Right Law of the PRC) 87. The women and men have equal rights to contract rural farmland. The legal rights and interests of women must be protected; any organization or individual cannot alienate or infringe on their rights of contracted management of land. During the period of contract, the contractees shall not take back or adjust the land. (Articles 6, 26 and 27 of the Law of the PRC on Land Contract in Rural Areas) 2. Provisions on Compensation Standard of Land Acquisition 88. For requisitioning land, compensation should be made according to the original 47 purposes of the land acquired. Compensation fees for land acquired include land compensation fees, resettlement fees, and compensation for attachments to or green crops on the land. The land compensation fees shall be 6–10 times the average output value of the three years preceding the requisition of the cultivated land. The resettlement fee shall be calculated according to the number of agricultural population to be resettled. The number of agricultural population to be resettled shall be calculated by dividing the amount of cultivated land acquired by the per capital land occupied of the unit whose land is acquired. The resettlement fees for each agricultural person to be resettled shall be 4~6 times the average annual output value of the three years preceding the acquisition of the cultivated land. But the maximum resettlement fee per hectare of land acquired shall not exceed 15 times of the average annual output value of the two years prior to the requisition. (Article 47 of the Law of Land Administration of the PRC) 89. The local people‘s governments at and above county level shall take effective measures to make sure the living level of farmers whose farmland is acquired won‘t be decreased for land acquisition. It is required to, in accordance with law and in full amount, pay land compensation fees, placement allowance, compensations for the above-ground fixtures of the lands and seedlings and other fees. The people‘s governments of provinces, autonomous regions, municipalities who provide farmers for land compensation fees and placement allowance according to current laws and regulations but can‘t keep their original living standard and can‘t afford the social security fee of farmers who lose farmland due to land acquisition shall be approved to increase placement allowance. If the sum of land compensation fees and placement allowance reaches the regulated upper limit but can‘t keep the original living standard of farmers whose farmland is acquired, the local governments may use the income from the compensated use of the SOL for compensation. Provinces, autonomous regions and municipalities shall establish and promulgate the uniform compensation standards by annual output value or district-based comprehensive land price. The acquired land of the same level shall be compensated for the same price. The National Key Construction Projects shall take the land acquisition fee in full amount into rough calculation. (Article 12 of Decisions on Deepening the Reform and Intensifying Land Administration by the State Council) 3. Provisions on Resettlement Approaches of Farmers whose Farmland is Acquired 90. People‘s governments at and above county level shall formulate concrete measures to guarantee the long-term means of living of farmers whose farmland is acquired. For projects with stable earnings, farmers may become a shareholder through legally approved right to use construction land. Within planned urban areas, the local people‘s governments shall bring farmers who lose farmland due to land acquisition into the urban employment system and establish a social security system. Outside the planned urban areas, to requisition collectively-owned land, the local governments shall provide necessary farmland for farmers whose farmland is acquired within the local administrative area or arrange corresponding jobs; and make resettlement in host community for farmers without land and basic living conditions. (Article 13 of Decisions on Deepening the Reform and Intensifying Land Administration by the State Council) 91. The farmers whose farmland is acquired may select the following resettlement approaches: (i) Placement on agricultural production. The acquisition of collectively-owned land outside the planned urban area should be made through rural collective mobile land, the land contractors voluntarily returned, added farmland due to land circulation and land development and arrangement, firstly making sure the farmers whose farmland is acquired have necessary farmland to continue agricultural production. (ii) Placement on re-employment. Conditions shall be created in an active manner to provide free labor-skill training and arrange jobs for the farmers whose farmland is acquired. Under the same condition, the priority of employment should be given to farmers whose farmland is

acquired by requisitioning units. For the acquisition of farmers‘ collectively-owned land within the planned urban area, farmers who lose farmland due to land acquisition should be brought into the urban employment system with the social security system established. (iii) Placement on shares dividends. For the land with long-term stable earnings at project sites, on a voluntary basis of farmers, after negotiation with requisitioning units, acquired rural collective economic organizations may buy shares by compensation allowance or convert the right of use of construction land into shares. By signing contract with rural collective economic organizations, farmers get returns through preference shares. (iv) Resettlement in Host Community. The farmers who lose farmland due to land acquisition but can‘t be provided with a basic living condition, after taking advices of acquired rural collective economic organizations and farmers, may be arranged by governments in uniform to make resettlement in Host Community. (Article 2 of Guiding Opinions on Improving Land Acquisition Compensation and Resettlement System) 4. Provisions on Transparency of Land Acquisition Information 92. During land acquisition, it is required to protect the farmers‘ right of use of collectively-owned land and right to operate contracted land. Before applying for approval of land acquisition, it is required to inform the farmers whose farmland is acquired of the purpose, location, compensation rate and placement approaches of land to be acquired. The investigation result on condition of land to be acquired should be confirmed by acquired rural collective economic organizations and farmers; if necessary, related departments of Ministry of Land and Resources should organize public hearings according to related regulations. Related documents known and confirmed by farmers whose farmland is acquired shall be submitted for approval of land acquisition. It is required to accelerate establishing and improving conciliation and arbitration mechanism on disputes in LAR, to protect legal rights of farmers and land users whose farmland is acquired. Approved land acquisition, if no special condition, should be declared publically. (Article 14 of Decisions on Deepening the Reform and Intensifying Land Administration by the State Council) 93. The people‘s governments of provinces, autonomous regions, and municipalities should prepare approaches on distributing land compensation fees inside rural collective economic organizations based on the principle of mainly using land compensation fees for farmers whose farmland is acquired. The acquired rural collective economic organizations should disclose the incomings and outgoings and distribution of land compensation fees to the members of the organizations to receive supervision. The agricultural department, civil administration department, and other departments should enhance the supervision on distribution and use of land compensation fee. (Article 15 of Decisions on Deepening the Reform and Intensifying Land Administration by the State Council) 94. Administrative organs should disclose government information promptly and correctly. In case of finding any false and incomplete information that affects or may affect social stability and disturb the order of social control, administrative organs should issue correct government information within the responsibility range to clarify. (Article 6 of Provisions of the PRC on the Disclosure of Government Information) 95. Administrative organs should be active in disclosing government information in ways easily known by the masses, such as government bulletin, government website, news conference, newspapers, radio, TV, etc. (Article 15 of Provisions of the PRC on the Disclosure of Government Information) 96. Governments at all levels should establish spots for consulting government information, and prepare accessory facilities to provide convenience for citizens, juridical persons, and other organizations. Administrative organs may set up public reference rooms, file acquisition spots, information publicity fields, and electronic information screens to disclose government information. Administrative organs should promptly offer disclosed 49 government information to the National Achieves and public libraries. (Article 16 of Provisions of the PRC on the Disclosure of Government Information) 5. Provisions on House Relocation 97. Regulations on Urban House Relocation and Compensation on state-owned land provides that: Article 11: 98. Municipal and County Governments will in time publish the situations of public comments and modification according to the public comments. 99. When the majority of the relocatees find relocation program does not comply with the provisions during the house acquisition due to the reconstruction of old city, hearings with representatives of displaced persons will be held by the Municipal and County Government; and the relocation program be modified according to the hearings. Article 12: 100. Before the decisions of house acquisition were made, Municipal and County Government will conduct a social stability risk assessment according to relevant regulations. If the sum of acquired houses rises above a certain level, the decision will be made through government executive meeting. Before the decision is made, compensation fund will be transferred fully to a special account, and earmarking. Article 13: 101. After the decisions of house acquisition have been made, Municipals and County Government will post a public notice in which relocation and compensation plan, administrative review, administrative litigations should be included. 102. Extensive publicity should be given by Municipals, County Government and resettlement department. The disposal of state-owned land will be reclaimed while the house is being acquired. Article 19: 103. The compensation for acquired house will not be lower than the market price of similar property before the decisions of house acquisition were made. The value of the acquired house shall be evaluated by qualified real estate assessment institutions according to the regulation of housing assessment. 104. Any individual who has objections to the housing assessment, may request re-evaluation. Any individual, who has objections to the re-evaluation, may request Housing Assessment Committee an accreditation. 105. Housing Acquisition and Assessment Measures are formulated by Urban and Rural Housing Department of State Council. In the process of formulation, it is necessary to solicit comments and suggestions from the public general. Article 20: 106. Real estate assessment organs will be chosen by owners of the acquired houses. If the negotiation among the owners failed, majority vote or random selection will be used. Specific measures will be formulated by the governments of provinces, autonomous regions and municipalities directly under the Central Government 107. Real estate organs will assess the acquired houses independently, objectively and publicly. Institutes and individuals may not intervene.

Article 21: 108. Relocation compensation may be monetary compensation or exchange of house property rights. If exchange of house property will be directed by owners of the acquired houses, municipal and county government will provide houses for exchange, and calculate and sort out righteously the price difference between the exchange house and the acquired house with the owners of the acquired houses. 109. In the re-construction of old city, If the owners of the acquired houses opt to exchange house property in re-constructed areas, Municipal and County Government will provide houses for exchange in re-constructed areas or nearby.

4.3.2 Abstracts of Related Regulations and Rules of Gansu Province

110. Land compensation and resettlement subsidy of cultivated land will follow the provisions of the Land Administration Law (Article 47). The land compensation and resettlement subsidy for other land areas (non-farmland) and attachments as well as green crops will follow the following standard: (i) Land compensation. The compensation for the acquired land areas for township village enterprises, public facilities, and community services should be 2 to 4 times of the annual average output value (AAOV) of the cultivated land for the past three years. The compensation for housing plot should follow 3 to 5 times of the AAOV of the cultivated land in the village. The compensations for waste land and unused land should follow 2 times of the AAOV of the cultivated land in the village. (ii) Resettlement subsidy. The resettlement subsidy for the acquired land areas for township village enterprises, public facilities, community services, and housing plots should be based on the number of persons requiring economic rehabilitation, which will be based on dividing the acquired land areas and per capita land holding in the affected village. For each person who needs economic rehabilitation, the resettlement subsidy will be set at 2 to 3 times of the AAOV. However, such a resettlement subsidy should not exceed 7 times of the AAOV. For acquired waste land and unused land, no resettlement subsidy should be provided. (iii) Attachment compensation. The attachment compensation should be based on the replacement price of the constructional work. The seedlings subsidy will be set at 4 times the cost of planting the same tree; as for fruit trees in bearing, the subsidy will be set at 4 to 6 times of the AAOV. Timber tree compensation will be based on the local price of the timber. Subsidies for farmland acquisition with sand surface will be set at 2 to 3 times of the AAOV three years ago. (iv) Green Crop Compensation. For average crops the compensation will be based on the average annual productive value. For land areas with no green crops planted, the compensation will be based on the amount of input made. (Implementation Regulation of Land Administration Law for Gansu Province, Article 24) 111. The compensation rates for acquired farmland and demolished structures for infrastructure projects. Land compensation and resettlement subsidy will follow the following standards: (i) for villages with per capita land above one mu, the land compensation for each mu of farmland will be based on 6 to 8 times of the AAOV in the past three years, and the resettlement subsidy will be based on 4 to 6 times of the AAOV; (ii) for villages with per capita farmland between 0.4 mu and 1 mu, the land compensation for each mu of farmland will be based on 8 to 10 times of the AAOV, and the resettlement subsidy will be based on 6 to 10 times of the AAOV; and (iii) for village with per capita farmland below 0.4 mu, the land compensation and resettlement subsidy for each mu of farmland will be set as no more than 25 times of the AAOV. Article 9: the land compensation and resettlement subsidy for other land, green crops, and c other attachments will follow the provision of Implementation Regulation of Land Administration Law for Gansu Province. (Method of Land Acquisition for Large Infrastructure Projects in Gansu) 112. Expropriation of rural collective land, with the average arable land above 1 mu, the total of land compensation and resettlement subsidies should not be less than 16 times of the 51

AAOV; with the average arable land above 0.5 mu but below 1 mu, the compensation should not be less than 22 times of the AAOV; with the average arable land below 0.5 mu, the compensation should be 30 times of the AAOV. (The Suggestions of Gansu Provincial People’s Government on Deepening Reform and Strengthening Land Management, 48# issue (2005)

4.3.3 ADB’s Relevant Policies on Involuntary Resettlement

113. ADB‘s Safeguard Policy Statement provides systematic guiding policies and operation instructions for the resettlement of its loan projects. 114. The objectives of involuntary resettlement by ADB are (i) If possible, involuntary resettlement should be avoided. (ii) If resettlement is unavoidable, all feasible options should be explored and the scope of resettlement should be as small as possible. (iii) Ensure that the displaced persons have the same economic and social conditions before and after the project. (iv) Improve the living standard of displaced poor and other vulnerable groups. 115. The principles of involuntary resettlement by ADB consists of (i) Screen the project early on to identify past, present, and future involuntary resettlement impacts and risks. Determine the scope of resettlement planning through a survey and/or census of displaced persons, including a gender analysis, specifically related to resettlement impacts and risks. (ii) Carry out meaningful consultations with affected persons, host communities, and concerned nongovernment organizations. Inform all displaced persons of their entitlements and resettlement options. Ensure their participation in planning, implementation, and monitoring and evaluation of resettlement programs. Pay particular attention to the needs of vulnerable groups, especially those below the poverty line, the landless, the elderly, women and children, and indigenous peoples, and those without legal title to land, and ensure their participation in consultations. Establish a grievance redress mechanism to receive and facilitate resolution of the affected persons‘ concerns. Support the social and cultural institutions of displaced persons and their host population. Where involuntary resettlement impacts and risks are highly complex and sensitive, compensation, and resettlement decisions should be preceded by a social preparation phase. (iii) Improve, or at least restore, the livelihoods of all displaced persons through (a) land-based resettlement strategies when affected livelihoods are land based where possible or cash compensation at replacement value for land when the loss of land does not undermine livelihoods, (b) prompt replacement of assets with access to assets of equal or higher value, (c) prompt compensation at full replacement cost for assets that cannot be restored, and (d) additional revenues and services through benefit sharing schemes where possible. (iv) Provide physically and economically displaced persons with needed assistance, including the following: (a) if there is relocation, secured tenure to relocation land, better housing at resettlement sites with comparable access to employment and production opportunities, integration of resettled persons economically and socially into their host communities, and extension of project benefits to host communities; (b) transitional support and development

assistance, such as land development, credit facilities, training, or employment opportunities; and (c) civic infrastructure and community services, as required. (v) Improve the standards of living of the displaced poor and other vulnerable groups, including women, to at least national minimum standards. In rural areas provide them with legal and affordable access to land and resources, and in urban areas provide them with appropriate income sources and legal and affordable access to adequate housing. (vi) Develop procedures in a transparent, consistent, and equitable manner if land acquisition is through negotiated settlement to ensure that those people who enter into negotiated settlements will maintain the same or better income and livelihood status. (vii) Ensure that displaced persons without titles to land or any recognizable legal rights to land are eligible for resettlement assistance and compensation for loss of non-land assets. (viii) Prepare a resettlement plan elaborating on displaced persons‘ entitlements, the income and livelihood restoration strategy, institutional arrangements, monitoring and reporting framework, budget, and time-bound implementation schedule. (ix) Disclose a draft resettlement plan, including documentation of the consultation process in a timely manner, before project appraisal, in an accessible place and a form and language(s) understandable to affected persons and other stakeholders. Disclose the final resettlement plan and its updates to affected persons and other stakeholders. (x) Conceive and execute involuntary resettlement as part of a development project or program. Include the full costs of resettlement in the presentation of project‘s costs and benefits. For a project with significant involuntary resettlement impacts, consider implementing the involuntary resettlement component of the project as a stand-alone operation. (xi) Pay compensation and provide other resettlement entitlements before physical or economic displacement. Implement the resettlement plan under close supervision throughout project implementation. (xii) Monitor and assess resettlement outcomes, their impacts on the standards of living of displaced persons, and whether the objectives of the resettlement plan have been achieved by taking into account the baseline conditions and the results of resettlement monitoring. Disclose monitoring reports.

4.3.4 Comparison of ADB’s Involuntary Resettlement Policies with the PRC’s LAR Policies

116. Generally speaking, there are many similarities between the ADB‘s involuntary resettlement policies and the PRC‘s LAR policies, which include: (i) Both of them attach an importance to avoiding or reducing resettlement during the planning and design stage of a project. (ii) Both of them attach an importance to the restoration and improvement of the livelihood of APs. (iii) Both of them attach an importance to the openness and transparency of the resettlement policies; 53

(iv) Both of them attach an importance to the participation and awareness of the public during resettlement. (v) Both of them require that the formulation and implementation of the resettlement compensation standards must be based on the law and according to the law. 117. However, there are still some differences in some aspects between ADB‘s involuntary resettlement policies and the PRC‘s LAR policies, which include: (i) ADB attaches more importance to the planning prior to the implementation of resettlement, and it requires that a feasible RP must be compiled. (ii) The ADB‘s resettlement policies require that during resettlement, all losses of all APs must be compensated according to replacement costs, including those people having no legal land ownership. However, the LAR policies of the PRC provide a different compensation policy to unlicensed buildings. (iii) ADB attaches more importance to the special care extended to the vulnerable people during resettlement. (iv) ADB attaches more importance to monitoring and checking during resettlement. 118. Based on the above analysis, during the preparation for resettlement, this Project takes full account of the relevant policies of ADB and takes the following measures to meet the demands of ADB: (i) The preparation of the Project must be based on concrete socioeconomic survey and physical survey, and the RP must be prepared in detail. (ii) Special care must be given to vulnerable people during resettlement implementation. (iii) Make compensation to non-registered buildings constructed before the cut-off time, based on replacement value of structures. (iv) Establish internal and external monitoring systems for resettlement. 119. With the above measures, the ADB‘s resettlement policies and the PRC‘s LAR policies will be seamlessly bridged and the smooth implementation of resettlement of the Project will be guaranteed.

4.4 Target of Resettlement

120. During the resettlement preparation and implementation, the following targets shall be strive for (i) Minimizing land acquisition and house demolishment. Minimizing impact on local life and production. (ii) The RP should be compiled based on LAR compensation standards, for the purpose of improving or resuming original local life and production standard. (iii) Production development compensation should be offered to increase working opportunities in the secondary and tertiary industries. (iv) Encouraging APs‘ participation in the RP.

4.5 Compensation Conditions

121. Following APs and organizations are entitled to receive the compensation: (i) persons whose houses are to be demolished, (ii) persons indirectly affected, (iii) persons whose lands are to be acquired, and (iv) affected organizations.

122. All people affected by land acquisition and house demolishment are entitled to receive compensation based on their actual losses which happens before the cut of date (31 December 2010) when the project redline was determined and the social and physical survey was conducted. Lands cultivated and houses built after the deadline will not be compensated.

4.6 Compensation Principles

123. Compensation shall be provided to people or agencies affected due to the Project implementation. The compensation shall be implemented in accordance with following principles: (i) Based on a detailed survey, negotiations on compensation with the APs should be conducted. (ii) All APs and affected stores, whether licensed or not, should be taken into consideration. (iii) In case the original life standard cannot be resumed, new working opportunities should be made available. (iv) Affected vulnerable groups should receive the priority consideration in compensation, movement, and employment. (v) All APs should be informed about rights, compensation standard, rehabilitation plan and project schedule. (vi) Monitoring and evaluation (M&E) are required to deal with relevant issues. (vii) According to ADB resettlement policies, compensation for acquired houses, land and other properties shall be calculated according to full replacement cost based on market prices. The calculation of full replacement cost will be based on fair market value, transaction costs, accrued interests, transition and restoration costs, and other potentially reasonable costs. Families affected by demolition will be given preferential treatment when they buy the relocated houses provided by the government. (viii) The purpose of project construction is to promote urban development in the future. Therefore, the local farmers will lose part of their lands due to this project; but they might lose all their land if the city expands in the future. ADB‘s Safeguard Policy Statement requires the borrowers to consider the future impact of involuntary resettlement. Considering that the farmers are likely to lose all their lands, a livelihood restoration plan will be designed for them. (ix) All affected shops/enterprises (licensed or not), shall obtain compensation for loss of earnings according to full replacement cost. Their livelihood will also be restored or improved. (x) The compensation and restoration measures will make sure the living standard of vulnerable families shall be improved.

4.7 Compensation Standards

4.7.1 Land Compensation Standards

124. Compensation standards are set up according to relative laws and regulations of the PRC, Gansu Provincial Government, DMG, and ADB‘s policies. Rural collective land acquisition compensation includes land compensation fees, resettlement fees, compensation for ground attachments, and young crops fee (Article 47 of Land Law). Compensation standards are presented in Table 4-1. 55

Table 4-1: Compensation Standards for LA

Type CNY/m2 CNY/mu Recipient Farmland 60 40,020 Land Contractor (AH) Green Corn fee 3 2,001 Land Contractor (AH)

Rural housing plots 45 30,015 Village Holders of the right to Construction Land 45 30,015 the use (state-owned) Holders of the right to Wasteland 45 30,015 the use (collective)

4.7.2 House Compensation

125. The compensation standards for replacement housing in rural areas based on replacement costs are presented in Table 4-2. The house values are divided into three groups. Monetary compensation for moving cost to relocated HHs will be provided at the standard of CNY2,400 per HH; in addition, temporary resettlement subsidy will be provided at CNY40 per capita per month (present renting market: CNY10/m2) for 12 months transition period. Standard of residential housing site will be 135 m2 per HH. Compensation standards for attachments are presented in Table 4-3. For affected small businesses, they will be compensated for structures replacement as the standards in Table 4-2. They will receive the compensation for moving cost of CNY2,400 per enterprises. In addition, they will receive compensation of CNY40 per capita per month for transition. Tree compensation standards according to tree‘s diameter are presented in Table 4-4. Economic value of different kinds of tree will be considered during evaluation of tree compensation.

Table 4-2: Compensation Standard of Housing

Type Unit Replacement Price Note Brick-concrete 1st class CNY/ m2 765 Brick-concrete 2nd class CNY/ m2 669 Brick-concrete 3rd class CNY/ m2 606 Brick-wood 1st class CNY/ m2 606 Brick-wood 2nd class CNY/ m2 552 Brick-wood 3rd class CNY/ m2 462 Earth-wood 1st class CNY/ m2 510 Earth-wood 2nd class CNY/ m2 415 Earth-wood 3rd class CNY/ m2 351 Simple 1st CNY/ m2 256 Simple 2nd CNY/ m2 190 Simple 3rd CNY/ m2 128 Business Suspended CNY/ m2 15 In total six months Renter CNY/person month 40 In total 12 months Moving Allowances HH 2400 Temporary Transition In total 12 months (if CNY/person month 40 Allowances resettlement is not

Type Unit Replacement Price Note arranged in 12 months, the transition will be extended)

Table 4-3: Attachments Compensation

Item Unit Price（CNY） Note Brick-concrete gate m2 500–3,000 Brick-wood gate m2 1,800 Earth-wood gate m2 500 Simple gate 500 Brick wall m2 80 Concrete floor m2 30 Double brick bed 100 Single kitchen 20 Single stove 20 Double stove 30 Treble stove 40 pool m2 211

Brick-concrete 2 m 80–260 vegetable cellar Water pipe m 30–50 Brick floor m2 15 Trench m2 100 Telephone 8 Cable 116

Table 4-4: Tree Compensation

Compensation Standard Diameter of Tree CNY Each Tree Less than 5 cm 10 6–10 cm 20 11–15 cm 40 16–20 cm 60 21–25 cm 80 26–30 cm 100 31–35 cm 300 36–40 cm 350 41–45 cm 500 46-50 cm 600 57

More than 51 cm 1,000

4.7.3 Compensation for Loss of Business Operation

126. According the regulation of DMG and the survey, operation or business suspended due to non-residential demolishment is compensated by CNY15 per m2 per month. The above affected businesses have enough time to look for new premises because they will be noticed in advance. They will receive the compensation for 1 month.

4.7.4 Compensation for Demolition of Temporary Structures

127. The compensation policy of the temporary structures is CNY100 per m2. The temporary structures are those built by villagers not used for living but for storage purposes without any approval by local administration institutions, and attached to their main houses. According to ADB‘s Safeguard Policy, the structures will be compensated based on their replacement costs. According to the house assessment agencies and local practice, CNY100 per m2 is sufficient to cover the replacement cost of such temporary structures. 4.7.5 Temporary Land Occupation 128. Existing construction land or wasteland on the project construction sites will be occupied if necessary in order to reduce farmland occupation. However, if any farmland is used temporarily for the project construction, the compensation will be provided to APs. The compensation standard is CNY3,400 per mu for 1 year occupation. The cost of land restoration will be included in civil work contract of each subproject.

4.8 Entitlement Matrix

Type of APs Entitled Persons Resettlement and Compensation Standards Implementation unit Losses Compensation Policy House to be Rural residential 472 persons or The monetary compensation The standards for housing replacement cost are PRO, Resettlement demolished houses 121 HHs in 9 will be given to housing as follows: CNY 606-765 per square meter for office of Town, Village groups owners. The relocation will be brick-concrete structure; CNY462-606 per committee. conducted before house square meter for brick-wood structure; CNY demolition. 351-510 per square meter for brick-earth-wood Municipal Land Relocated house site will be structure; CNY 128-256 per square meter for Resource Bureau will coordinated by village simple structure. issue certificate for committee without charge. new land usage after The definite housing compensation is the houses are built. determined on the basis of individual assessment. The removers pay the relocation HHs and housing tenants the compensation for relocation: CNY40/person per month, in total 12months. The standard of housing site land for building houses in villages is 135 m2 / household. Moving allowance: CNY2,400/HH (or each business) Rental houses 54 persons or 18 The tenants have priority to Tenants will receive compensation of PRO, Resettlement for living HHs lease, to be compensated; CNY40/person per month, for 12months if they office of Town, Village The tenants will obtain can‘t find new places before house demolition committee. appropriate rights according housing lease agreement Self-employed 27small (i) The relocated people The standards for housing replacement cost are PRO, Relative HHs businesses with a are compensated according as follows: CNY 606-765 per square meter for department of total building area to the house compensation brick-concrete structure; CNY462-606 per Township of 4,986 square standard; square meter for brick-wood structure; CNY Government, meters (ii) Individual proprietors are 351-510 per square meter for brick-earth-wood Resettlement office of compensated for losses from structure; CNY 128-256 per square meter for Town, Village production suspension and simple structure. The definite housing committee. cessation of business compensation is determined on the basis of 59

Type of APs Entitled Persons Resettlement and Compensation Standards Implementation unit Losses Compensation Policy according to construction individual assessment. The land is compensated areas; in CNY 45 per square meter. (iii) Property owners will be provided with relocation and Compensation for production suspension and transition fees. cessation of business will be CNY15 /square (iv) Lessees are meter. Construction land of 8,525 square meters compensated for losses from will be provided to relocate small businesses. production suspension and cessation Collectively- 11 Groups of 1,149persons or (i) There is no land Farmland: CNY60/square meter; PRO, Resettlement owned 4 Villages 323 HHs adjustment in all affected Seedling: CNY3/square meter; office of Town, Village farmland of villages. Non-farmland: CNY45/square meter. committee. 589.02mu, (ii) The compensation for 100% of the compensation for contracted housing of the acquired land is set farmland. Residential land and wasteland will be 123.54 mu, according to land acquisition paid to affected village committees. and compensation standards. wasteland of (iii) The compensation for 214.01 mu above-ground attachments belongs to its owner.

Temporary Rural HHs Will survey during The monetary compensation Based on average annual output: CNY3,400/mu PRO, Resettlement land implementation will be given according to the The cost of land restoration will be included in office of Town, Village actual useful years during the civil work contract. committee. project construction. Trees Owners The villagers, The monetary compensation Trees of economic value: CNY10-1,000 each. PRO, Resettlement villages or other or transplant fee will be given office of Town, Village institutes to all APs committee. according to the entitlement Other Owners The villagers, The monetary compensation Cattle pen: CNY400//square meter; PRO, Relative Agricultural villages or other will be given according to Agricultural production building: CNY700/square department of Production institutes replacement price. meter. Water Cellar: CNY 2,000/set; The Township Facilities according to the monetary compensation will be given according Government,

Type of APs Entitled Persons Resettlement and Compensation Standards Implementation unit Losses Compensation Policy entitlement to replacement price. Methane tank: Resettlement office of CNY4,500/set (two holes); Ammonia tank: CNY Town, Village 300/cubic meter committee. Vulnerable Low-income 78persons from PRO, Relative Groups HHs(less than 24 HHs (1) Helps on relocation will be Setting up a fund of CNY 30,000 to help the department of per capita given to vulnerable HHs vulnerable groups. Every relocated HH that lives Township CNY1,000 per through village committees. below the MLGL/poverty line will get a living Government, year in rural (2) Village committees take subsidy of CNY 1,000. Resettlement office of area; HH with at the responsibility of offering Town, Village least one transitional houses to committee. disabled；Senior vulnerable HHs if transitional period exists. Citizen HHs; (3) Single-parent

HHs

V. PUBLIC PARTICIPATION AND CONSULTATION

129. In the decision process of the planning, design and implementation of the Project, The DUCIAM and Dingxi Housing Demolition Company (DHDC) took the opportunity of socioeconomic surveys and social effect evaluation to propagandize the background information of the Project in various ways, made consultations with all kinds of APs, and negotiated about the common concerns. The public participation and consultation provide a basis for the improvement of the RP.

5.1 Public Participation and Consultation Activities Performed

130. As to all significant topics for discussion involved in the planning stage of resettlement, the DUCIAM has organized design organizations, consultant organizations, local ROs, and affected population to disclose information and conduct public consultation in various ways. Main disclosure and consultation activities so far are shown in Table 5-1.

Table 5-1: Main Activities of Resettlement Information Disclosure and Consultation

Content of No. of No. Time Disclosure and Participant Organizer Participant Consultation Shanghai Municipal Engineering Optimization of Design Institute, Gansu Taohe Civil 2009.8－ 1 project design Engineering Design &Consulting 25 DUCIAM 2010.2 scheme company, Affected Villages and Representatives of APs Shanghai Municipal Engineering Design Institute, National Statistics 2010.12 Bureau Dingxi Investigation Team, 3 Amount of LAR 250 DUCIAM －2011.3 Gansu Taohe Civil Engineering Design &Consulting company, Affected Businesses and Villages Shanghai Municipal Engineering Design Institute, National Statistics Bureau Dingxi Investigation Team, Compensation 2010.12 Gansu Taohe Civil Engineering 4 rate for land 40 DUCIAM －2011.3 Design &Consulting company, Local requisition villages, groups, Affected Businesses and Villages. Representatives of APs Shanghai Municipal Engineering Design Institute, Gansu Taohe Civil Engineering Design &Consulting 2010.12 Compensation 5 company, National Statistics Bureau 118 DUCIAM －2011.2 rate for houses Dingxi Investigation Team, Affected Institutions and Enterprises, Affected Villages and Representatives of APs Shanghai Municipal Engineering Design Institute, Gansu Taohe Civil 2010.12 Social effect of Engineering Design &Consulting 6 250 DUCIAM －2011.2 the project company, Resettlement Consultants, APs, Affected Institutions and Enterprises,

DUCIGC, Resettlement Consultants, Resettlement 2010.12 Affected Institutions and Enterprises, 7 mode and 70 DUCIAM －2011.1 Gansu Taohe Civil Engineering desire Design &Consulting company, APs.

2010.12 Resettlement 8 DUCIGC, Affected Businesses. 70 DUCIAM －2011.2 policies

Negotiation on DUCIGC, Gansu Taohe Civil 2010.12 9 resettlement Engineering Design &Consulting 25 DUCIAM —2011.3 locations company, APs. DUCIGC, Gansu Taohe Civil Resettlement of 2010. 12 Engineering Design &Consulting 10 enterprises and 27 DUCIAM －2011.3 company, Affected Institutions and institutions Enterprises.

5.2 Feedback on Public Participation and Consultation

131. From December 2010 to March 2011, the RP preparation agency and the National Statistics Bureau Dingxi Investigation Team generalized and summarized the opinions and advices put forward by them, timely fed back to engineering design organizations, and fully considered and absorbed these opinions and advices when formulating the RP. Feedback on public participation and negotiation up to now is shown in Table 5-2. 63

Table 5-2: Feedback on Public Participation and Consultation

Reasons and Results Measures for Improvement Item Problems

Try to avoid or reduce the compact districts of houses passed through in the design of the project. Project design should try to implement on the current base, reduce scale of land acquisition and house It makes residents lose Road project will relocation. original houses, affecting demolish some their daily life. houses. First Phase of Jiaotong Rd.: based on the comparative selection of part ‗K1+160~K2+18‘,the sideline of road is guaranteed to outside the surrounding wall of Bailin Primary School

Determine the affected scope as Land soon as possible and inform affected requisition and population of them. So relocated relocation HHs can build new houses and tenants can arrange their living in Most residents, advance. particularly For example, one household in peasants, haven‘t 5‘She‘ of Bailin Village eventually received relevant Relocated HHs and understood the land acquisition of information of the tenants will be affected his housing sit and farmland with the project through and might be able to timely explanation of village committee. formal channels, arrange their living especially At the same time, it is advised that regarding definite relevant information of the project LAR time. should be widely spread to give affected population profound understanding and sufficient knowledge in a palpable manner, such as broadcast, television, local drama, song, regular meeting, etc.

The masses are The compensation and The resettlement divisions should concerned about Compensation allocation of the funds are disseminate relevant compensation the compensation funds related to living support of rate before the construction and and allocation of relocated HHs. make the masses well-informed. the funds.

It is advised that strict institutional and financial disclosure should be implemented, such as disclosure of Some residents worry that compensation rate, measurement Allocation mode of compensation funds won‘t size, evaluation grade, etc. After the compensation be allocated fully or will be determination of compensation funds. held back. funds, they should be posted for disclosure and subject to the participation and supervision of affected population. Compensation funds are directly allocated to the peasants in the form of bankbooks.

The project construction will cause damage to original power and communication facilities (e.g. wire stands, Try to reduce damages to existing transformers and public facilities; maintain damaged The construction of communication public facilities or change their the Project will transmission towers) to courses in the process of cause damage to some extent. And water construction to avoid unnecessary infrastructure to supply facilities and conflicts. Try to repair and rebuild Public facilities different extents. access roads of some damaged public facilities as well as and residents and enterprises power and communication facilities. environment are also involved, which exerts negative influence to production and residents‘ living.

Because traffic on roads Construct green belts at both sides causes a lot of noise, of the road during the project Noise pollution normal work and rest of construction; in special road section, the residents living near to sound-insulated wall may be set to roads will be affected. reduce noise.

Some auxiliary It is advised to build traffic lights in Auxiliary Traffic facilities for facilities are to be places where the population is facilities crossing the road. established. dense.

To hand out resettlement manuals and establish channels for complaints and feedback, for Let displaced persons instance, hot line for complaints and Let displaced share project benefits and suggestion boxes. To set up a Mass persons take part promote the enthusiasm of consultative system. To hold as participation in each cycle of the local governments at all many as possible consultation project. levels and the masses. meetings participated by project office, street offices, and representatives of villagers‘ committees and displaced persons.

5.3 Consultation Plan with Affected People

132. With the continual advance of the preparation and construction of the Project, the DUCIAM shall carry out further consultation activities. Main contents of consultation include: 65

(i) Concrete opinions of APs on the engineering design. Before the construction, the DUCIAM shall inform the APs along the lines of the design information and the specific effects of the project. At the beginning of the construction, the DUCIAM will implement exploratory survey along the lines and determine the concrete positions and sizes and so on of structures. For places with which the masses aren‘t very satisfied, the DUCIAM will organize the design department again to revise the design on the premise that engineering standards are met. (ii) Arrangement of compensation for relocated households and payment procedures. (iii) Measures of enterprises and institutions for avoiding being affected and recovering. (iv) How to rehabilitate electricity and water supply functions affected during the construction period. And (v) Other problems concerned by displaced persons. 133. See Table 5-3 for time arrangement for further consultation meetings of ROs at all levels and APs. According to work arrangement of the DUCIAM, district and street administrative offices, villages (communities) will hold consultation meetings and report relevant situations to the Resettlement Division. Besides participating in the consultation activities organized by the DUCIAM, monitoring departments also should hold meetings on other monitoring problems and collect the complaints and suggestions of affected people, and then provide monitoring information to land acquisition departments at all levels. Table 5-3: Time Arrangement for Consultative Meetings with APs

Content Time Attendees Comments on engineering January 2011- DUCIAM, design department, independent design November 2011 monitoring institution Resettlement mode and concrete February 2011- DUCIAM, design department, independent implementation plan August 2011 monitoring institution The whole period of Rehabilitation of electricity and DUCIAM, Affected villages, independent project water supply monitoring institution implementation The whole period of Problems occurred during the DUCIAM, Affected villages, independent project project implementation monitoring institution implementation The whole period of Collection of suggestions and project Independent monitoring institution, DUCIAM complaints implementation

5.4 Methods of Consultation of APs during Project Implementation

5.4.1 Direct Meeting

(i) APs‘ meeting Meetings with representatives of APs or village cadres should be held to collect their key problems and ideas for which the opinions from local government and RO should be obtained. (ii) Affected enterprises and institutions consultation meeting

For relocation site, compensation ratio, etc., concerning enterprises, institutions and small businesses, consensus should be reached with their legal persons or representatives through consultation. (iii) Consultation meeting on town-level land acquisition Consultation meeting on LAR should be organized jointly by sub-component ROs and held separately. Organize APs to visit the resettlement location and auxiliary facilities for the convenience of their selections. And collect their opinions to improve the RP. After the meeting, relevant personnel should visit APs and the latter should sign Resettlement Compensation Agreement through full negotiation. 5.4.2 Indirect Consultation

134. APs may reflect their complaints, ideas, and suggestions to village (community) committee and resettlement and monitoring departments at all levels. The ROs should feedback relevant handling ideas.

5.5 Information Disclosure

135. In order to let all APs understand in time and thoroughly the resettlement policy and implementation of the project so that resettlement can be carried out openly, fairly, and transparently, resettlement agencies at all levels adopted the following measures: (i) On April 14, 2012, the resettlement policies and standards was published on the fourth page of Dingxi Daily or other media. (ii) Each affected village/community has disclosed its situation of APs, compensation rates, resettlement measures, and complaint and appeal channels in public. (iii) Before May 31, 2012, the RP for the Project will be available at the public libraries or other public places of affected areas, to which all APs may refer at any moment. (iv) Provide one Resettlement Information Booklet for each household affected before May 15, 2012. 136. The following will be listed in detail in the Resettlement Information Booklet: (i) the situations of various affected families, (ii) proper compensation policy and compensation rates, (iii) project progress, and (iv) procedures for solving dissatisfactions and complaints of displaced persons. The booklet will be issued to APs after the RP is approved by the DMG and ADB, and its pattern is as shown in APPENDIX I. The RP will be posted on ADB Website in compliance with the ADB‘s Safeguard Policy Statement after approved by the DMG, and reviewed by ADB. 137. The various types of compensation standards listed in this RP, which are based on the field investigations, the laws of the PRC and regulations of Gansu Province and the ADB‘s Safeguard Policy Statement, aiming to rehabilitate and improve the APs‘ life in the short term, are developed after the consultation of the affected enterprises and institutions, local inhabitants, and local government. These standards take the full consideration of the various implementing construction projects and the operability of the future construction process. 67

VI. IMPLEMENTATION PLAN FOR RESETTLEMENT AND REHABILITATION

6.1 Objectives and Principles

6.1.1 Objectives of Resettlement and Rehabilitation

138. In accordance with the policies on involuntary resettlement of ADB and the requirements of relevant national laws and regulations, the overall objective of the resettlement of the Project is to rehabilitate as soon as possible and improve as much as possible the living conditions and production of affected population and enterprises and public institutions. The concrete objectives are as follows: (i) Affected households will obtain compensation calculated by replacement cost, and the area, structure and living environment of their reconstructed houses may reach and exceed the levels prior to relocation. (ii) All kinds of attachments to the ground affected are compensated by replacement cost. (iii) Public buildings and special facilities are compensated by replacement cost and may be rehabilitated to their original status. (iv) After reconstruction of enterprises, their production scale and capability as well as employment of employees will not be affected. No labor force in affected enterprises will lose their jobs permanently. (v) Public facilities and environment of affected communities will be rehabilitated to their original status and even improved. (vi) Farmers whose land is acquired will be properly allocated compensation, and their incomes will be guaranteed and increased by improving production conditions. No farmers will lose their livelihoods permanently due to land acquisition. (vii) With full consideration of land loss completely due to the new district construction, concrete social security measures should be applied.

6.1.2 Principles of Resettlement and Rehabilitation

139. Following principles shall be adopted during the resettlement and rehabilitation implementation. (i) APs will participate in the whole process of resettlement. For issues including compensation rates of houses and facilities, selection of sites of resettlement, schedule of relocation, schedule of rehabilitation, fund disbursement, and measures for rehabilitation of production and operation, APs or their representatives must be involved and consulted with to reach an agreement. Symposia of representatives and consultation meetings of affected residents or affected villagers will be held. (ii) All compensation will be completely and directly given to the APs. Set up special account for compensation fund to keep any unit, individual or villagers‘ committee (community) (including every district, township, and street) from retaining compensation fund. (iii) Compensation for houses, special facilities, and attachments to the ground will be calculated by replacement cost.

The amount of compensation shall not be retained, depreciated or levied taxes. The compensation obtained by property owners must be calculated by the publicized rates. All the property of originally built structures shall belong to property owners. There shall be no depreciation of property values based on age. The residual value of surplus material left after relocation shall not be deducted from compensation. Taxes for re-registering land, property, and other fees will either be waived or will be paid by the IA. (iv) Help and care will be offered to vulnerable groups. Vulnerable families should be given priority in selection of resettlement housing, offer of information on resettlement housing, supply of low-rent housing, and purchase price of affordable housing; and in employment opportunities created in the process of project implementation, distribution of service networks at resettlement sites, etc. (v) Compensation for acquired houses, land, and other properties shall be calculated according to full replacement cost. The calculation of full replacement cost will be based on fair market value, transaction cost, accrued interest, transition and restoration cost, and other potential reasonable costs. Affected families due to demolition will be given preferential treatment when they buy the relocated houses provided by the government. (vi) The purpose of the Project is to promote urban development in the future. Therefore, the local farmers will lose part of their lands because of the Project at this time but will experience future city expansion and lose more land. ADB‘s Safeguard Policy Statement requires the borrowers to consider the future impact of involuntary resettlement. Considering that the farmers are likely to lose all lands in future due to the urbanization of the project city, a livelihood restoration plan will be designed for them that emphasizes non-farm activities. Meanwhile, the farmers who lose all lands will be considered as urban households without employment (for such a household, the DMG will offer at least one job for the family, transfer them from rural residents to urban residents, and provide urban minimum living safeguard system to them), and be offered necessary training and priority to be employed. (vii) All affected shops/enterprises (licensed or not) shall obtain compensation for loss of earnings according to full replacement cost. Their livelihood will also be restored or improved. The compensation and restoration measures will make sure the living standard of vulnerable families shall be improved.

6.2 The Relocatees’ Willingness of Resettlement

140. In order to ensure the process of resettlement and establish a procedure of public participation and consultation for APs, the DUCIAM conducted the investigation, workshop, and hearings with relocatees in terms of compensation policies, housing site selections and their willingness and advice. The relocatees‘ willingness of resettlement include as below: (i) Most of the rural relocatees wish to rebuild houses on their own contracted land, with help from village committee. The area of each HHs‘ housing site is 135 square meters. Their original houses and lands will be compensated. The relocation will be conducted before house demolition. It is confirmed that there are house sites for relocation in affected villages. (ii) Some of the relocatees who chose resettlement housing wish to increase the proportion of small apartment. The resettlement housing design has been updated in accordance with their needs and suggestions. (iii) Some of the relocatees would like move into urban resettlement housing. 69

(iv) During the implementation period, if some affected families need to buy houses in the city, they may purchase commercial residential buildings in the real estate market after being compensated at replacement price.

6.3 The Resettlement of Rural Households

141. The APs may build their houses in their villages, purchase commercial residential apartments, or relocate to the resettlement housing area. The detailed relocation plan is shown below: (i) Groups 1 and 2 in Bailin Village. The APs will be relocated within the same groups. There are 5 HHs, in total 650 m2 (or 0.97 mu). (ii) Groups 6, 7, 8, 10 and 12 in Bailin Village; Berershilipu, and Xieheping groups. The APs will be relocated in Beiershilipu (DUCIAM and local government will provide housing sites with necessary infrastructures, and the APs will build houses themselves). There are 98 HHs, in total 19,208 m2 (or 28.798 mu; land occupation of infrastructure has been calculated in). Considering the relocation is close to where the APs currently live, they have agreed on this arrangement. (iii) Shilipu and Bozhihe groups. 18 HHs in total will be relocated in government subsidized housing units at the price of CNY1,880 per m2. It‘s affordable to purchase such apartments for APs since the area of their demolished houses are big. For instance, one of the APs has a house of 170 m2, they can afford to buy a subsidized housing unit of 69.2 m2 according to the compensation standard. (iv) Local government promised that all affected 24 poor households will have their replacement houses. 142. For affected households (and small businesses) who are required to resettle in other places, housing land will be provided freely. The DUCIAM will work with municipal land administrative bureau, planning bureau, and district government to determine lands for resettlement. Affected households (and small businesses) will build their houses according to unique planning and design. The municipal administrative bureau will issue certificate for the new housing land after buildings completion. The DUCIAM and local government will be responsible for completion of basic site construction and infrastructures such as roads, supply water, and electricity, etc. for new relocation places. The affected households will be easy to build their houses. According to local construction cost of brick-concrete structures of about CNY500 per m2, the compensation is sufficient for building new houses even though affected households need to hire some labors for house construction. 143. Rural relocation plan is shown in Table 6-1.

Table 6-1: Resettlement Plan of Affected Rural Residents

Self-constructed Relocation Housing Subsidized Housing HHs Population Housing Village Group Resettlement Sites HHs Housing Area HHs Housing Area HHs Price HH person HH m2 HH m2 HH CNY/ m2 1 4 18 Self-constructed 4 520 2 1 4 Self-constructed 1 130 5 0 0 none Bailin 6,7 39 119 Resettle in Beiershilipu 39 7,644 8 11 50 Resettle in Beiershilipu 11 2,156 10 5 13 Resettle in Beiershilipu 5 980 12 23 101 Resettle in Beiershilipu 23 4,508 Beiershipu Xieheping 20 88 Resettle in Beiershilipu 20 3,920 Donghe Shilipu 10 43 Subsidized housing 10 1,880 Xiershi Bozhihe 8 36 Subsidized housing 8 1,880 Total 121 472 5 650 98 19,208 18 1,880

Note: Collective resettlement in Beiershilipu has been approved by APs. It will be good for the resettlement housing construction. 71

6.4 Resettlement and Rehabilitation of Affected Small Businesses

144. There are 27 small enterprises or businesses affected scattered in the Project area. According the field survey, there are two kinds of businesses affected. The first group includes non-commercial facilities and buildings, such as lavatories, power distribution rooms, and idle buildings. These buildings will be either compensated monetarily or rebuilt during the construction period. The second group includes production and business enterprises or self-operated stores. New premises will be found with the assistance of the local government and the new shops arranged before relocation for them. They will have no losses on relocation with the relocation subsidy. It‘s easy to find new premises since most of the affected businesses are small-scale (relocation first, demolition later). Among the 27 small businesses, the Starch Factory and Shibalipu Flour Factory have been closed down. These two factories have agreed that they will allow the road pass through after the compensation and removal of the properties. 145. According the above analysis, house demolition has minor effects on business activities. Enterprises and employees don‘t suffer any loss. The relocatees will obtain relocation subsides. The standard of subsidies are determined by Dingxi Price Bureau (market price has been considered too) and used for compensating equipment move and installation. The relocatees‘ income will not be lowered. DPMO will help APs obtain house sites for relocation and production, and ensure the entire process. 146. 18 out of 27 businesses will reopen in their native places, 2 out of 27 will dispose their assets, and 7 out of 27 will be restored in Beiershilipu (will have new premises, after full consultation). A total house land of 8,525 m2 will be acquired. Most of affected small businesses are self-employed shops and they will be relocated on their residential lands, which are provided by the Project. The coal plant will be moved to Beiershilipu and the same area of housing land of 1,964 m2 will be provided. The compensation for housing land is at CNY45 per m2. The restoration plan for affected businesses is presented in Table 6-2.

Table 6-2: Restoration Plan for Small Businesses

Area of Restoration Plan Area of Number of House In Native Housing Village Unit Houses Employees Move to Lands Places Area m2 m2 person m2 Building Ximing 53 53 2 new houses Coal Plant 1,963.67 1,178.2 2 Beiershlipu 1,963.67 Building Jinlin Store 64.8 64.8 2 new houses Building Mill A 112.5 112.5 1 new Bailin houses Building Mill B 84.8 84.8 1 new houses Building Welding Plant 34 34 2 new houses Building Nongjiale 78 78 3 new restauraunt houses

Area of Restoration Plan Area of Number of House In Native Housing Village Unit Houses Employees Move to Lands Places Area m2 m2 person m2 Building Wangjin 24 24 2 new Grocery houses Building Daliy Grocery 32 32 1 new houses Building Post Office 18 18 1 new houses

Noodles 30 30 2 Beiershlipu 30 factory

China Mobile 20 20 2 Beiershlipu 20

provender 50 50 2 Beiershlipu 50 mill

Building Waste 428 60 2 new Recycle houses Steel 380 120 5 Beiershlipu 380 wholesale

Bailin Building Yangji Oil Mill 80 80 3 new houses Flour Mill 260 110 4 Beiershlipu 260 Building Xinyu Oil 104 104 3 new houses Building Tianyi 22 22 2 new Grocery houses Shang shoe 10 10 1 Beiershlipu 10 shop Building Flour shop 20 20 1 new houses Building Zhenghua 40 40 2 new ceramics houses Starch Disposal 2,561.5 1,588.13 0 Factory of assets Shipalipu Disposal 1,408.5 859.18 0 Flour Mill of assets Building Shulan 60 60 2 new Grocery houses 73

Area of Restoration Plan Area of Number of House In Native Housing Village Unit Houses Employees Move to Lands Places Area m2 m2 person m2 Building Lvyintang Silk 562.5 109.3 2 new noodles houses Building Meimei store 24 24 1 new Bailin houses Total 8,525.27 4,986 51 2,713.67

Note：Restoration in Beiershilipu has been consulted with the affected businesses. New premises will be provided. There are residents living in new resettlement community as a market for restored businesses.

6.5 Resettlement Plan of Beiershipu

147. DPMO is in charge of the land acquisition and infrastructure development in Beiershipu. 98 HHs and 7 small businesses will be relocated in Beiershipu; accordingly, the occupation of land will be 41.58 mu. The resettlement community is located near the village committee. APs may build their houses after infrastructure development is accomplished. The schedule of the resettlement is presented in Table 6-3.

Table 6-3: Schedule of Construction of Resettlement Site in Beiershipu

Action Time Complete detailed design, get approval, and start June 2012 tender invitation Mobilize infrastructure construction July 2012 Complete necessary facility September 2012 APs start to build houses October 2012

6.6 Rehabilitation of Living Conditions of Farmers Affected by Land Acquisition

6.6.1 The Overall Plan

148. Resettlement plan fully reflects the participatory approaches and concepts. Resettlement policies are as follows: to respect the wishes of the APs and to maintain their existing production and life traditions. According to the survey and consultation with local APs, the APs are provided with the monetary compensation which can be used to improve existing agricultural conditions, such as expansion of irrigation systems, or invest in other sidelines or non-agricultural production activities. 149. The resettlement and restoration principals, which are formulated from the policies as follows: (i) The resettlement plan is based on physical indicators of land acquisition and demolition and the compensation for land acquisition and subsidy criteria. (ii) Resettlement, combined with regional development, resource development, economic development, and environmental protection, reflects the sustainability of the development of local economy and the affected farmers. Taking into account the local natural and socioeconomic conditions, practical RP should be

formulated to restore and develop production, and create basic conditions for long-term sustainable development. (iii) Resettlement plan should be formulated in accordance with the "benefit production and facilitate life" principle. (iv) Considerate fully and broadly, handle the relationship of the state, collectives, and individuals correctly. (v) The APs gradually meet or exceed the original standard of living by way of making full use of local natural resources, increasing technologic investment, and improving agricultural production. 150. According to APs‘ advice and suggestions, combined with the actual situation of the affected areas, the basic recovery plan is determined as follows: (i) APs are resettled in the village so that they can keep the original way of life and production as well as social relationship, recover and improve their production and income levels after land acquisition, and enhance the initiative and adaptation in living and production. (ii) The households affected by land acquisition can get land compensation and resettlement fees.

6.6.2 The RP for APs’ production

151. In the project impact survey and resettlement planning process, by using participatory methods of work, the resettlement planning group held meetings with the leaders of the affected town and villages involved and consulted with representatives on proposed compensation policies and rehabilitation measures. 152. In the process of land acquisition, the land administration department will distribute the request for proposals, which regulates the standards of land compensation and resettlement fees and hold resettlement compensation hearings. The DUCIAM will handle land acquisition procedures under the regulations. After the land acquisition application is approved, Dingxi City Land Resources Bureau will handle the land acquisition procedures. Dingxi City Land Resources Bureau will sign the land acquisition agreement with affected villages after it is approved and publicized by affected villages. 153. Impact of land acquisition varies from village to village. Therefore, the rehabilitation plan should be based on the degree of impact, the availability of remaining land resources and the will of the affected staff. In order to increase the APs‘ income, the following measures will be adopted: develop characteristic agriculture along with traditional agriculture to increase unit output, improve labor export, rent out excess houses, increase employment in private workshops or processing Industry, and develop Industry and trade. Theoretically, APs can save the compensation into commercial banks to earn interests, which is higher than their loss due to land acquisitions based on annual agricultural production, see Annex I for details. On other hand, they can improve their income though change planting structure or develop non-farm businesses, as presented in Annex I. They should have such opportunity because they live near urban areas and industry zone of Dingxi City. The DPMO with support by Dingxi Municipal Government will provide relevant training for APs to improve their employment skill of APs as presented in Section 6.7.

6.6.3 Social Pension Insurance of the Landless Farmers

154. Gansu Provincial Government issued ―Pension Insurance Method of Farmers Whose Land Is Acquired of Gansu Province‖, and DMG will implement the Method in the Project. 75

The method covers partial land acquisition and complete land acquisition. Farmers who lose their land more than 20% are qualified to participate in the pension insurance system. Farmers will pay 40% of the insurance and local government will pay 60%, see Annex II for details.

6.7 Training for Farmers Affected by Land Acquisition

155. The project area is in the nearby suburbs of Dingxi City. Many farmers in this area have lost their farmlands due to the urbanization. In the future, there will be more farmers losing farmland. The training may help farmers affected by land acquisition improve their employability in cities. Survey and workshops indicate that most of the farmers in employment age would like to learn some work skills if they don‘t have to pay much. According to the survey data, approximately 9,000 farmers (one-third are women) have such demand for training. In accordance with ―Employment and Reemployment Fund Management in Gansu Province‖ (Gansu Financing Decree 103 of 2006), qualified training institutions may apply for occupational subsidy once (Expenses for training can be remitted). Labor section and other relative sections appoint training institutions and training courses. Before the training courses start, the contents of the training courses (including training program, students, training duration, and training methods) will be submitted to labor and financing department. Qualified training institutions may apply for training subsidies after the training. The subsidies are usually set at CNY300–400 per person. According to relative policies, the Project will offer employment training and urban life guide to all affected farmers. Restoration training will help them obtain more job opportunities and improve their income level and living standard. In 2010, 4,100 farmers were trained in Anding District, including about 2,000 farmers whose land was acquired. Main contents of training included skill training such as computer operation, building construction, and service industry. The training is combined with the future development of Dingxi New Urban Area and local industrial parks, and increase skill of APs to work in manufacture industry such as the basic skill required by Dingxi Gaoqiang Screw Co., Dingxi Jinrong Piston Co., and Dingxi Jindadi Potato Development Co., etc. Dingxi Social Safeguard Bureau provides employment information to APs freely and APs can find jobs suitable for them. The training has created many job opportunities to the farmers. Accordingly, their living standard and quality have been improved. 156. Anding District Government will provide such training program to farmers affected by the Project. Affected farmers will have opportunity to get skill training during the project implementation. Anding District Government will provide different training courses to affected farmers combining local development of industrial or service sectors, and labor needs. The PMO will hold meeting with affected farmers with assistance of local governments to understand demand of the affect farmers in skill development. All training courses will be free to affected farmers. The Project has prepared a training plan for farmers who will be affected by the Project as presented in Table 6-9. Affected farmers will be trained to improve their skills for rehabilitation according to their real needs and levels affected by the Project. The training can mitigate negative impacts to the farmers due to land acquisition, and promote their rehabilitation, at least recovery to their original living conditions. Two family members at least (one male and one female if possible) each affected household will be trained.

Table 6-9: Training Plan for Affected Farmers Number of Budget No. Skill Participants (CNY10,000) (person) 1 Potato and wheat planting 350 5.5 2 Chinese medicine (herb) planting 250 8.5 3 Small business 250 5.5 4 Happy Farmers restaurants 210 21 5 Vehicle drive 30 3.5 6 Skills for different industrial sectors To be decided 35.5435 Total +1090 79.5435 6.8 Social Safeguard for Affected Poor and Vulnerable Groups 157. Minimum living security (MLS). Minimum Living Security Line (MLSL) of rural residents in Anding District is CNY1,000 per capita per year. For individual whose annual income under the line, the MLS will make up for their annual income to CNY1,000. MLSL of rural residents in Fengxiang Town is divided into four levels of CNY107, 77, 62, and 30 per month, respectively. MLSL of urban residents in Anding District is CNY230 per capita per month. For individual whose annual income under the line, the MLS will make up for their monthly income to CNY230. 158. Medical insurance for low-income. Urban low income HHs in Anding District enjoy medical insurance worth CNY100 per capita each year (CNY10 paid by individuals, CNY90 by government). Rural residents covered by MLS enjoy CNY70 medical insurance (CNY20 paid by individuals, CNY50 paid by government). All rural low-income households‘ insurance premiums are paid by government (from a medical assistance fund in rural areas). 159. Affordable housing and low-rent housing system. HHs without housing, housing hardship HHs, and HHs with housing lower than 16 m2, are given the priority to purchase affordable housing and rent low-rent housing. The price of 50 m2 apartment is worth CNY65,000 (affordable housing unit price is CNY1,300 per m2). These kinds of HHs can purchase affordable housing. 160. The social security system has been established after years of efforts in Anding District. On the basis of social security system, APs‘ basic life need and dwelling demand will be satisfied. 161. Special provisions for affected vulnerable households. The RO and village committees will provide special supports for vulnerable people who will be affected by the Project. (i) The village committee will offer laborers to help vulnerable families in resettlement. (ii) The village committee will arrange transition houses for vulnerable families if needed. (iii) The families of vulnerable groups have priority in selecting housing area, house type and location of collectively re-constructed houses. (iv) For houses suitable for small business in relocation site, the vulnerable families are given priority to rent them. (v) A total of CNY30,000 is set up as the supporting fund of vulnerable group and other households who need special assistance. 77

(vi) CNY1,000 will be disbursed to each family who live under the MLGL as a one- time living subsidy.

6.9 Rehabilitation of Special Facilities

162. The special facilities affected by the Project mainly are electric and telecommunication facilities, for which the resettlement agency will pay compensation by replacement costs on the basis of full consultation with power and telecommunication departments. These facilities will be rehabilitated and reconstructed before land acquisition is implemented, so as to ensure the normal production and livelihood of local population.

6.10 Schedule of Resettlement and Rehabilitation

163. The civil engineering of this Project is planned to be commenced in October 2012. The final RP shall be submitted to ADB for review and approval before August 2012. In order to guarantee that affected population and organizations will be properly resettled, land acquisition will be finished prior to civil engineering. See Table 6-10 for the schedule of all kinds of resettlement activities.

Table 6-10: Schedule of Resettlement Activities

2011 2012 2013 2014 2015 2016 Activities I II III IV 1 2 3 4 5 6 7 8 9 10 11 12 I II III IV I II III IV I II III IV I II III IV Project Procedure Strategy decision and Project Approval Feasibility study preparation and approval Preliminary design and detailed design Bidding and contract signing Preliminary preparation of civil work

Civil work construction Civil work completion and check Land Acquisition and Resettlement Preparation Land use approval Identify the scope of LAR Conduct socioeconomic survey Conduct measurement survey of AP Establishment of cut-off date Determine compensation standards Prepare the RP Identify and confirm poor and vulnerable AP Finalize compensation/resettlement strategies Conduct DMS and final RP Institutional setup and training Land Acquisition and Resettlement Implementation Hold mobilization meetings and publicize policies Announce public notification Negotiate and sign contracts Disburse compensation payment & acquire land 79

Construction of infrastructure & houses House demolition notification Size of housing chosen Allocation of housing unit Decision of payment scheme Relocation timing Final move to the new resettlement site Grievance redress after each stage & agreement Demolition of existing houses after the move to new site Livelihood and Income Restoration Employment of AP in the Project construction Implementation of measures to increase income of AP New skill training Institution, enterprise and shop rehabilitation M&E Establish internal monitoring system & formats Engage monitoring agency Approve TOR by ADB Training of resettlement staff Monitor LAR activities Monitor income restoration programs

VII. BUDGET AND MANAGEMENT OF RESETTLEMENT

7.1 Composition of Resettlement Fund

164. The resettlement budget of this component are mainly composed of six parts, i.e., (i) land acquisition compensation, (ii) relocation compensation, (iii) specialized compensation for rehabilitation and conversion, (iv) administrative cost, (v) other relevant cost, and (vi) contingency budget.

7.1.1 Land Acquisition Compensation

165. Land acquisition compensation is calculated according to the compensation standards of Dingxi. Refer to Table 4-1 for more details. In addition, relative taxes include (i) fee for using new construction land, (ii) fee for land creation, (iii) farmland acquisition tax, and (iv) land acquisition administrative fee, as presented in Table 7-1. Table 7-1 Other Costs for Land Acquisition

Name Category Unit Standard Farmland Class I CNY/m2 20 Fee for land creation Farmland Class II CNY/m2 15 Other Farmland CNY/m2 2 to 10 Fee for using new 2 Anding District CNY/m 24 construction land Farmland acquisition CNY/mu 20,800 tax Land acquisition Based on cost of land % 4.0 administrative fee acquisition

7.1.2 Relocation Compensation

166. Relocation compensation includes (i) Compensation for rural private houses This is calculated according to floor space and compensation rates of rural private houses. House prices will be calculated by estimating the replacement cost. The compensation for land acquisition of resettlement is CNY30,000/mu; Infrastructure construction fee is CNY18,000/HH (The compensation here is evaluated based on previous project experiences. The compensation and fee will be paid by the DUCIAM.). (ii) Compensation for affected buildings of enterprises This is calculated according to the type and floor space of buildings to be relocated of enterprises and public institutions. House prices will be calculated by estimating the replacement cost. Meanwhile, bonuses, moving allowances, transition allowances, construction allowances, and relative moving allowances will be compensated.

7.1.3 Specialized Compensation for Rehabilitation and Conversion

167. The ground attachments, compensation, and public facilities for private households, the self-employed households, and shops are calculated according to the actual number of survey. According to the survey, 81 poles, 8 transformers, and 2,012 trees in Project area will be refunded. The compensation details are presented in Table 7-2. 81

7.1.4 Administrative Cost

168. Administrative cost is 2% of compensation for houses relocation and specialized compensation. It is mainly used for preparation prior to resettlement and the office cost and administrative cost during implementation of the resettlement. Specifically, it is composed of purchase of office products, employee salary, transportation, communication, travel, and so on.

7.1.5 Other Relevant Costs

169. Some other costs incurred during the preparation and implementation of resettlement includes survey and design research expenses, training fees, reclamation costs, new construction land compensation fees for new vegetable field development fund, tax, food regulation fund, land acquisition, and management fees.

7.1.6 Contingency Cost

170. Contingency cost includes basic contingency and price contingency, which will be 5% and 10% of the basic cost respectively.

7.2 Resettlement Budget

171. According to the compensation rates and statistical data of all kinds of affected items, the total resettlement fund of the ADB financed project – Dingxi Urban Infrastructure Development Component is about CNY141,184,445. See Table 7-2 for detailed fund budget. The component is planned to complete within 5 years. The investment plan is presented in Table 7-3. The composition of the budget is listed in Table 7-4. Table 7-2: Resettlement Budget of the Project

Standard Amount Item Unit Quantity (CNY) (CNY) 1. Land

Compensation Farmland mu 42,021 589.02 24,751,220 Construction mu 30,015 123.54 3,708,053 Land Type Waste Land mu 30,015 214.01 6,423,503 State-owned mu 50,000 62.00 3,100,000 Resettlement mu 42,021 41.58 1,747,233 sites Subtotal 1030.15 39,730,009 2. Housing

Compensation Brick-concrete m2 765 31,024.80 23,733,972 Brick-wood m2 606 2,878.50 1,744,371 Earth-wood m2 510 526.00 268,260 Rural Temporary m2 200 299.70 59,940 Bonus m2 150 34,729.00 5,209,350 Moving HH 2,400 121 290,400 Const

Standard Amount Item Unit Quantity (CNY) (CNY) Transition person/year 480 472 226,560 Telephone HH 8 320 2,560 Cable HH 116 52 6,032 Field mu 30,000 28.80 864,000 Resettlement Construction Site Infrastructure HH 18,000 98 1,764,000 Brick-concrete m2 765 4985.91 3,814,221 Brick-wood m2 606 0 0 Earth-wood m2 510 0 0 Small Enterprises and Temporary m2 200 0 0 Business 2 Bonus m 100 4,985.91 498,591 Suspend loss m2 15 4,985.91 74,789 Moving HH 2,400 27 64,800 Field mu 30,000 12.78 383,400 Resettlement site Construction Infrastructure HH 18,000 27 486,000 Subtotal 39,491,246 3. Specialized compensation Pole 1,000 81 81,000 Transformer 5,000 8 40,000 Tree 100 2,012 201,200 Subtotal 322,200 1,2,3 Subtotal 79,543,455 House 4. Administrative Relocation 2% 1,590,869 Cost Administration Cost

Monitoring Cost 1.0% 795,435 Training Cost 1.0% 795,435 for APs Land use fees mu 10,672 968.15 10,332,097 5. Other fees Land and taxes development mu 6,670 968.15 6,457,561 fund fee Arable land mu 20,800 968.15 20,137,520 occupation tax Survey design and evaluate mu 1334 968.15 1,291,512 cost costs 83

Standard Amount Item Unit Quantity (CNY) (CNY) Land Acquisition 4.00% 1,589,200 Administrative cost Temporary Land mu 3,400 60.00 204,000 Occupation Vulnerable HH 1,000 32 32,000 Groups Fund Subtotal 41,634,759 1 -5 Subtotal 122,769,083 6. Contingency cost

Basic 5% 6,138,454 Price 10% 12,276,908 Subtotal 18,415,362 Total 141,184,445

Table 7-3: Investment Plan

Year 2012 2013 2014 2015 2016 Total Proportions 0.45 0.35 0.1 0.05 0.05 1 Amount (CNY) 63,533,000 49,414,556 14,118,444 7,059,222 7,059,222 141,184,445

Table 7-4: Proportion of Cost Analysis

Quantities (CNY) Proportions (%) Land Compensation 39,730,009 28.1 Houses Compensation 3,949,1246 28.0 Specialized Compensation 322,200 0.2 Administrative Costs 1,590,869 1.1 Other Costs (including survey and external monitoring and 41,634,759 29.5 evaluation) Contingency 18,415,362 13.0 Total 141,184,445 100.0

7.3 Allocation and Payment of Resettlement Fund

7.3.1 Resettlement Fund Receivers

172. The resettlement fund of this project will be allocated to different receivers according to the property rights of affected items. See Table 7-5 for details. For the sake of full and timely payment of compensation to affected people and organizations, the roles of independent monitoring organization, internal monitoring organization and national auditing

body will be given full play to, and intermediate links will be minimized for paying the resettlement fund in a simple and convenient way. Table 7-5: Resettlement Fund Receivers

Compensation Expense Category Receiver CNY

Cultivated land Affected HHs 24,751,220

Construction land Collective committees 3,708,053

Wasteland Collective committees 6,423,503

State-owned land User of the land 3,100,000 Collective relocation land for resettlement Collective committees sites 1,747,233

House demolition Affected HHs 31,541,445 Affected HHs and Collective site construction collective committees 864,000

Collective site infrastructure Contractors 1,764,000

Small businesses Owners of the businesses 5,321,801

Special recovery compensation Affected HHs 322,200 Survey and Monitoring M&E cost Agency 795,435

Training cost Trainees 795,435

Fee for land use Land resources bureau 10,332,097

Fee for land development fund Land resources bureau 6,457,561

Arable land occupation tax Land resources bureau 20,137,520 Survey and Assess Survey design and evaluate cost costs Agency 1,291,512

Land Acquisition Administrative cost Land resources bureau 1,589,200

Temporary land occupation Land holders 204,000

Vulnerable Groups Fund Vulnerable Groups 32,000

Administrative cost for housing Management departments 1,590,869

Contingency 18,415,362

Total 141,184,445 85

7.3.2 Source and Flow of Resettlement Fund

173. The resettlement fund of the Project is raised by the DUCIAM. The fund will be directly paid through special accounts to receivers.

7.4 Payment, Management, and Monitoring of Resettlement Fund

7.4.1 Payment of Resettlement Fund

174. The payment of resettlement fund will be implemented in conformity with the following principles: (i) All the expenses related to land acquisition will be counted in the total construction budget estimate. Subcomponent implementing agencies should review the respective compensation fees and apply for payment approval of the DUCIAM will directly pay compensation fees through special accounts to relevant organizations and personnel. (ii) The specified banks should directly pay all kinds of compensation fees in the form of bankbooks to affected families before relocation is implemented. (iii) Land compensation should be paid before land acquisition is implemented.

7.4.2 Management and Monitoring of Resettlement Fund

175. The payment of resettlement fund must be implemented in strict accordance with relevant laws and regulations of the state on LAR as well as the policies in the RP, and should not be lower or less than the compensation rates and range stipulated in the plan. 176. Each component office should report monthly construction scheduling to the DUCIAM. The component offices should submit reviewed payment reports with signatures of principals in charge to the DUCIAM for payment. The company will disburse construction progress payment accordingly, and will give payment to affected objects directly. Each component office is responsible for supervising the use of payment. 177. Each component office should examine and approve land compensation, housing compensation, compensation for attachments, compensation for physical relocation (including indoor facilities), moving allowances, transition allowances, rewards for ahead-of-schedule relocation, and losses of small businessmen and of enterprises and public institutions. 178. The DUCIAM will engage accounting organizations to conduct regular internal check of use of resettlement fund of ROs. 179. The financial department and auditing department of Dingxi City are entitled to monitor and audit the use of the special fund. 180. The external monitor will carry out special follow-up monitoring of the payment of compensation for affected families and enterprises and public institutions.

VIII. RESETTLEMENT ORGANIZATIONS

8.1 Organizational Structure

181. In order to implement the resettlement of the Project well, all levels of relevant governments of Dingxi City guarantee the preparation of the Project and the smooth progress of resettlement by establishing and strengthening relevant organizations. Since January, 2010, the organizations with definite responsibilities for resettlement of the Project have been set up. The main organizations concerned include (i) Anding District Resettlement Leading Group, (ii) Foreign Load Office of Dingxi Finance Bureau, (iii) Dingxi Urban Construction & Investment and Asset Management Ltd Co., (Dingxi ADB Project Management Office), (iv) Anding Urban Construction Bureau, (v) Dingxi Land Resources Administration Bureau, Anding Branch, (vi) Anding Urban Housing Demolishment Office, (vii) Township Resettlement Group, (viii) Village Committee Resettlement Group, and (ix) Independent External Monitoring and Evaluation Institution. 182. See Figure 8-1 for the structure of resettlement organizations.

Figure 8-1 Resettlement Organizations for the Project

DMG

Anding District Dingxi Finance Dingxi ADB PMO Dingxi Land Dingxi Housing & Government Bureau Resource Bureau Construction Bureau

Land Housing & Fengxiang Resource Construction Bureau Government Bureau

Project Resettlement Office

Village Committees

8.2 Responsibilities of Organizations

8.2.1 Resettlement Leading Group

183. Resettlement Leading Group consists of Dingxi Municipal Development and Reform Committee, Anding District Government, Anding Development and Reform Bureau, Anding Urban Construction Bureau, Dingxi Land Resources Bureau Anding Branch, Anding Environment Protection Bureau, and other relative organizations. The main duty of this Group is to reinforce the Project leadership to ensure the smooth implement of land acquisition and resettlement. The Group is in charge of resettlement policy formulation and relationship coordination.

8.2.2 Foreign Load Office of Dingxi Finance Bureau

184. As the project owner, it is responsible for submitting all plans and reporting work pertinent to resettlement to national, provincial, and municipal departments for approval and comments.  Be responsible for raising resettlement fund, and  Be liable for payment of resettlement fund.

8.2.3 DUCIAM (Dingxi ADB Project Management Office)

 Entrusting resettlement consultation institutions to make preliminary preparations for resettlement,  Coordinating consultation and other organizations during the preparation of the project,  Applying to relevant department for land planning license and land use and construction license,  Coordinating with relevant departments to work out policies of the RP,  Aligning the progress of project construction with the RP,  Coordinating work of relevant organizations,  Organizing detailed resettlement survey of subcomponents and updating RP based on final design,  Implementing subcomponent resettlement,  Determining and submitting subcomponent resettlement fund plans,  Tracing and supervising the practical payment of subcomponent resettlement fund,  Dealing with grievance and appeals of displaced persons in the process of resettlement,  Coordinating with independent monitoring organization,  Collecting and sorting out all kinds of information needed for internal monitoring report,  Submitting subcomponent resettlement files, and  Receiving the ADB ROrs for inspection together with the Resettlement Division. 89

8.2.4 Anding Urban Construction Bureau

185. Main duties are  Coordinating with Resettlement Office, formulating, and Implementing resettlement plan;  Organizing public benefit discussion and advocating resettlement polici;es  Coordinating to deal with land acquisition and resettlement;  Managing and monitoring resettlement fund;  Dealing with problems and conflicts in process of implement;  Coordinating with internal and external inspection institutions; and  Writing process reports and submitting to DPMO.

8.2.5 Dingxi Land Resources Administration Bureau, Anding Branch

186. Responsible for rural land acquisition. Its main duties are:  Determining affected areas and analyzing social and economic situations,  Making resettlement plans and cooperating implements,  Organizing public benefit discussions and advocating resettlement policies,  Carrying out matters relating to land acquisition,  Monitoring the payment of resettlement,  Training the personnel in villages,  Monitoring resettlement work in the street committee and the village(s),  Dealing with conflicts and problems in process of implement,  Carrying out internal and external inspection activities, and  Drawing up process reports and submitting to PMO.

8.2.6 Anding Urban Housing Demolishment Office

 Implementing first-phase preparations for resettlement together with resettlement consulting organizations,  Setting forth all the policies of the RP,  Training persons in charge of resettlement of subcomponents,  Reporting resettlement progress to DUCIAM,  Reporting work of communication and coordination with other departments,  Verifying resettlement fund plans of subcomponents,  Submitting resettlement fund plan to DUCIAM and supervising the payment of fund,  Directing and supervising the implementation of subcomponent resettlement,  Managing data file on resettlement,  Carrying out internal monitoring of resettlement,  Dealing with grievance and appeals of displaced persons in the process of resettlement, and

 Communicating with independent organization in the process of resettlement implementation.

8.2.7 Township Resettlement Group

187. The Group consists of personnel from township government, land administrative bureau, police office, and village committee. The leaders of township government are in charge. Its main duties are:  Participating in project research and giving assistance to make resettlement plans,  Organizing public participation and advocating resettlement policies,  Carrying out, inspecting, monitoring and recording all resettlement activities arranged by street committees,  Responsible for compensation payment and management,  Reporting land acquisition and resettlement process to Land Bureau and Resettlement Office,  Dealing with conflicts and problems in process of implement, and  Managing the fund and activities for vulnerable groups.

8.2.8 Village Committee Resettlement Group

188. Most members of the village committee resettlement group will contribute to settling resettlement issues. Their duties are:  Participating in socioeconomic and project impact research,  Organizing public discussion and advocating resettlement policies,  Issuing compensation to land users,  Conveying APs‘ comments and proposals to monitoring institutions,  Dealing with comments and complains,  Reporting implement process to monitoring institutions, and  Helping vulnerable households.

8.2.9 External monitoring organization

189. During the implementation of the RP, the external monitoring organization is responsible for external monitoring of resettlement and for submitting resettlement progress reports and supervision reports to project resettlement office (PRO) of the DUCIAM and the DPMO. The responsibilities of this organization are described in detail in the chapter concerning external monitoring.

8.3 Personnel and Facilities of Resettlement Organizations at All Levels

190. There are five personnel in the PRO. They are very capable of implementing organization and coordination, have rich experience in resettlement, and are skillful in using computers. All subcomponents resettlement organizations are also composed of high-quality and experienced personnel, and therefore can completely meet the requirements of resettlement. See Table 8-1 for personnel roster. See Tables 8-2 and 8-3 for personnel and facilities of subcomponent resettlement organizations at all levels. 91

Table 8-1: Personnel of ROs at All Levels

Resettlement Organization Person in Charge Personnel Dingxi Foreign Loan Office Xue, Ling 2 DUCIAM He, Zhigeng 6 Anding Urban Housing Demolishment Dong 12 Office Independent external monitoring To be determined before RP implementation institution

Table 8-2: Arrangement of Personnel of Resettlement Organizations at All Levels

Total Resettlement number of Personnel and qualification Work duration organizations personnel Personnel who are proficient in December, 2010 - Dingxi Foreign Loan foreign languages, computer and 2 completion of Office engineering technology and resettlement familiar with resettlement policies The person in charge has five December, 2010 - years of resettlement experience, DUCIAM 6 completion of college degree education resettlement background Long-term experience in similar December, 2010 - Anding Urban work, with an educational completion of Housing 12 background of undergraduate or resettlement Demolishment Office above level. assessment Long-term experience in similar February 2012 - Independent external work, with an educational completion of 5 monitoring institutions background of undergraduate or assessment of above level. resettlement

Table 8-3: Facilities of Resettlement Organizations at All Levels

Computer Camera 2 Organization Vehicle (set) Office (m ) (set) (set) Dingxi Foreign Loan Office 1 1 1 50 DUCIAM 3 2 1 100 Anding Urban Housing Demolishment Office 4 2 2 360 Based on the requirements of bidding document Independent external monitoring institutions outlines

8.4 Measures for Institutional Strengthening

191. In order to implement the RP successfully, guarantee the interests of affected population, and satisfy the overall project schedule, DUCIAM will take the following measures to strengthen the capabilities of the organizations and improve efficiency. (i) Leadership responsibility system. Responsible leaders of district governments will organize relevant departments including development and reform commissions to form a strong leading group.

(ii) Arrangement of high-quality personnel. Personnel of resettlement organizations at all levels should have the idea of considering the overall situation, good grasp of policies and professional abilities, especially experience in mass work. (iii) Determination of responsibilities. To determine the responsibilities of ROs at all levels according to the requirements of ADB and relevant national laws and regulations. (iv) Training of resettlement personnel. To give regular training on resettlement policies and information management to resettlement personnel according to actual needs. (v) Supervision by the public. All the resettlement information will be released to the public for supervision. (vi) Provincial RO will hold irregular resettlement report meetings and issue relevant briefings to all districts. (vii) Project office will provide necessary vehicles and office facilities for resettlement organizations at all levels to meet their needs. 192. See Table 8-4 for plan of reinforcement and training of organizations in future. Table 8-4: Schedule of Operational Training of Resettlement Organizations in Future

Training No. Content Trainee Date organization To learn and investigate Personnel of experiences in resettlement resettlement division 1 DUCIAM 2011- 2012 of ADB financed projects of and subcomponent other provinces ROs Personnel of External Monitor Resettlement policies of resettlement division 2 March 2012 ADB and subcomponent ROs Personnel of The latest change of External Monitor resettlement division 3 resettlement policies of the March 2012 and subcomponent state ROs Personnel of Experiences and lessons of resettlement division 4 DUCIAM May 2012 resettlement of other places and subcomponent ROs Personnel of Foreign Computer operation and 5 DUCIAM Loan Office and May 2012 data processing subcomponent ROs Work process and policies Street (township) of resettlement of the Asian 6 DUCIAM ROs, village-level March 2012 Development Bank resettlement groups Financed Project

Resettlement policies and Street (township) 7 DUCIAM practices ROs, village-level June 2012 resettlement groups

IX. COMPLAINTS AND APPEALS

193. To ensure the complaints of displaced persons can be handled smoothly and rapidly, the resettlement division of the DUCIAM will establish a transparent and feasible collecting and handling procedure of dissatisfaction and complaints to deal with such issues objectively and efficiently.

9.1 Methods of Collecting Dissatisfaction and Complaints

194. Methods of collecting dissatisfaction and complaints consist of: (i) The report of local RO, which includes complaints of the masses, the progress of resettlement, working measures, and existing problems; (ii) The construction log faxed to the Owner by the construction organizer, which shows whether and how the masses affect the construction; (iii) The site inspection of the DUCIAM, during which the problems relating to the LAR may be found; (iv) Relevant information provided by the independent monitoring organization; (v) Letters and visits of the displaced persons; (vi) Information provided by the workstation of the Owner; (vii) Relevant problems found by auditor and discipline inspection departments; (viii) Information on payment of land compensation shown on the fund transfer list provided by the bank; and (ix) Specific survey of internal monitoring agency.

9.2 Procedure of Complaining and Appealing

195. The Procedures of complaining and appealing are suggested as follows although APs have the ability to access the civil legal system at all stages of the process: Phase 1 The displaced persons give their oral or written complaints to the village (community) committee or local RO. In case of oral complaint, the village (community) committee or local RO must keep a written record and give a clear reply within 2 weeks. If it is a big issue that shall be submitted to the superior RO, the village (community) committee or local RO shall try to get the comments of the superior RO within 2 weeks. Phase 2 If the reply given in the Stage 1 fails in satisfying the complainer, the complainer may appeal to the district RO within 1 month after receiving the decision of Stage 1. The district RO shall make a decision on the appeal within 3 weeks. Phase 3 If the complainer is dissatisfied with the decision of the district RO, he or she may appeal to the PMO RO or DUCIAM within 4 weeks after receiving the reply of stage 2. The PMO RO will give its comment within 4 weeks. If there are no agreements, administrative arbitration can be implemented.

Phase 4 If the complainer is still dissatisfied with the reply of Phase 3, he or she may appeal to civil court within 15 days after receiving the reply.

9.3 Principles of Handling Complaints

196. The ROs at various levels must carry out site survey on the complaints of the masses, collect their opinions, and negotiate with them patiently, in accordance with the principles and standards stipulated in the rules and regulations of the state and the RP, and give comments objectively and reasonably. The RO shall report those problems that cannot be handled on its own to the superior RO timely and assist the latter in carrying out relevant survey. 197. If the RO of the previous stage fails in giving a reply within the specified period to the complaint, the complainer has the right of appeal. 198. During the resettlement, some special complaints and appeals of women may appear; therefore the project office plans to hire at least one female employee for each resettlement team to deal with women‘s complaints. The local governmental and non-governmental organizations, such as the Bureau of Civil Affairs and the Women's Association will supervise the resettlement to ensure the rights and interests of the displaced persons, especially that of affected women.

9.4 Contents and Ways of Replying to Complaints

9.4.1 Replies to Complaints

199. Replies to complaints are as follows: (i) Brief description of the complaint, (ii) The result of survey, (iii) The principles and standards stipulated in the rules and regulations of the state and the RP, and (iv) Comments on handling the complaint and its basis.

9.4.2 Ways of replying complaints

200. Ways of replying complaints are: (i) As to the individual complaint, written reply shall be sent to the complainer directly. (ii) As to the common complaint, the reply shall be announced in the village (community) meeting or shall be notified to the village or community in the form of formal document. (iii) Whatever way of replying is adopted, the replay shall be sent to the corresponding RO of the complainer.

9.5 Records of Complaints and Appeals and Relevant Feedback

201. During the implementation of the RP, the DUCIAM shall keep a record of complaints and the results of handling and submit a monthly written report to the DUCIAM, which will carry out a regular inspection on the record of complaints handling. 202. To keep a complete record of the complaints of the displaced persons and the handling of relevant issues, the DUCIAM has designed a record form for this purpose, shown 95 as Table 9-1.

Table 9-1: Record Form of Complaints and Appeals on the Resettlement

Acceptor: Time: Place: Complainer Content Demanded solution Planned solution Actual handling

Complainer Recorder

(Signature) (signature) Remarks: 1. The recorder shall register the actual complaint and demand of the complainer. 2. The complaining shall not be disturbed or hindered by any factor. 3. The planned solution shall be notified to the complainer in the specified period.

9.6 Contact Information for Complaints and Appeals

203. The ROs of the districts shall arrange the principals to collect and receive the complaints and appeals of the displaced persons. See Table 9-2 for their names, office addresses, and telephone numbers. Complaints can also be sent directly to ADB (see table 9-2) if the local grievance redress mechanism is not addressing their concerns. ADB will contact Gansu Provincial PMO to deal with complains or send officials to investigate and deal with complains. If an AP believes that ADB has not complied with their policy and this has lead to harm, APs may also submit a complaint in accordance with ADB‘s Accountability Mechanism (AM)2. AM will start investigation process to deal with complains.

Table 9-2: Information of Organizations and Persons for Receiving Complaints and Appeals of Displaced Persons

Contact Organization Address Telephone person Dingxi Foreign Loan Office Xue, Ling Dingxi Finance Bureau 13830278083 12 Gongyuan Rd. Anding DUCIGC He, Zhigeng 18215239828 District, Dingxi City Dingxi Urban Housing 28 Fengan Rd. Anding Dong 18909323889 Demolishment Office District, Dingxi City

ADB +(63) 2-632-6224 6 ADB Avenue ADB Staff R. Mamatkulov Mandaluyong City 1550 +(86)10-8573-0909 Metro Manila, Philippines

9.7 Budget for Complaints and Appeals Management

204. The cost for managing complains and appeals during the Project implementation is included into the administration budget of the resettlement plan.

2 Before submitting a complaint to the Accountability Mechanism, affected people should make a good faith effort to solve their problems by working with the concerned ADB operations department. Only after doing that, and if they are still dissatisfied, should they approach the Accountability Mechanism. For further information see: http://www.adb.org/Accountability-Mechanism/default.asp.

X. RESETTLEMENT MONITORING

205. Based on resettlement plan, the resettlement monitoring will constantly investigating, inspecting, monitoring, and evaluating resettlement activities.

10.1 Internal Monitoring

10.1.1 Purpose and Principles

206. The internal monitoring indicates the continuous internal monitoring on the implementation of the RP carried out by the Owner and the ROs throughout the management system. It aims at obtaining the accurate progress of resettlement timely and integrally, finding and solving problems and providing the basis of decision-making for the smooth implementation of resettlement. 207. The purpose of internal monitoring provides a criteria and guidance for the internal monitoring of resettlement carried out by the project Owner, the executive agencies of resettlement, and the organizations relating to the resettlement to ensure that the implementation of resettlement complies with the RP and the resettlement M&E are carried out orderly, normally, and efficiently, therefore the relevant organizations may get to know the implementation of the resettlement timely and the problems occurred may be found and eliminated early. 208. The principles of internal monitoring include to (i) update RP, (ii) establish and update resettlement database, (iii) collect data and analyze information accurately to ensure the accuracy of the results of monitoring, (iv) conduct scientific and objective evaluation on the implementation of the RP justly, and (v) submit report to the project Owner and the ADB semi-annually to keep them informed of the progress of the project and able to make scientific decision. 209. The function of internal monitoring: The internal monitoring is an important integral part of the internal management of the project; it directs to mastering the implementation of resettlement; through the establishment and use of resettlement information management system, the progress of the implementation of the resettlement and the data and information of the relevant funds and quality are collected, analyzed and shared and the existing and potential problems and the causes may be found and the measures and suggestions on solving the problems may be proposed. 210. The internal monitoring of the resettlement shall be conducted by the Owner and the ROs and the Owner shall submit the internal monitoring report to the ADB semi-annually.

10.1.2 Procedure of Internal Monitoring

211. The internal monitoring can be divided into two phases, namely, preparation phase and implementation phase. The preparation phase begins at project identification period, through project preparation, project pre-assessment and project assessment, finally ends at project approval period of the project cycle. The implementation phase begins at the implementation of the resettlement and ends at the achievement of the aim of resettlement. 1. Preparation Stage of Internal Monitoring 212. The Owner and the local government shall establish the ROs at the early period of project preparation. The Owner shall establish an internal monitoring system for resettlement with capable personnel specialized in resettlement to ensure the provision of complete and objective information and data, which also contributes to the involvement of the organizations of other fields. The internal M&E of the resettlement shall be arranged in the project preparation period. 97

213. Preparations of the Owner include (i) To organize the trainings on the resettlement policy of the ADB and relevant experiences, national resettlement policy, the design of the RP, resettlement implementation ,and the M&E of resettlement for the staff of the Owner and the ROs; (ii) To invite professional agency and professionals who will assist in the design of the RP as early as possible, to organize socioeconomic survey, and to design the RP with the help of the professional agency and professionals; and (iii) To establish resettlement information management system with the help of the professional agency and professionals. 214. Preparations of the resettlement agency include (i) To sign the detailed resettlement implementation contract with the Owner; (ii) To establish the ROs at various levels and arrange necessary personnel for them; (iii) To organize resettlement staff trainings, to carry out socioeconomic survey and the design of the RP together with the Owner and the professional agency it invited; and (iv) To establish the resettlement information management system. 2. Implementation Stage of Internal Monitoring 215. During the implementation stage, the district RO shall submit the information on resettlement implementation and up-to-date record of relevant activities to the RO to ensure the follow-up monitoring of the resettlement. The RO will carry out regular inspection on the ROs at town (street) level and village (community) level and verify the progress of resettlement reported by them. 216. During the implementation stage of the internal monitoring, the Owner shall, (i) In accordance with the RP, preside over the internal monitoring of the resettlement, (ii) Submit a detailed internal monitoring report to the ADB every half a year, and (iii) Update the statistics of the resettlement implementation in time and complete the resettlement information management system.

10.1.3 Contents of Internal Monitoring

217. Generally, the internal monitoring shall include the following: (i) Organization. The establishment and assignment of resettlement DUCIAM and relevant organizations and their personnel assignment and capability development; (ii) Resettlement policy and compensation rate. The design and implementation of resettlement policy; the actual implementation of compensation rates of various losses caused by the resettlement (permanent land acquisition, temporary land occupation, house relocation, store relocation, the relocation of public institution and enterprise, and the relocation of specific facility); and specific identification of whether the rates in the RP is implemented and the causes of any changes occurred; (iii) Progress of relocation and resettlement. The general schedule and the yearly schedule, the progress of personnel assignment of the resettlement agency, the progress of land acquisition and temporary occupation, the

progress of adjustment, acquisition (or transfer) and assignment of the land of resettlement area (including land for production, residential building, and public facility), the progress of house relocation, the progress of the construction of resettlement house, the progress of the moving of displaced persons, the progress of production development project, the progress of the construction of public facility, the progress of the recovery, removal and reconstruction of specific facilities, the progress of the removal and reconstruction of industrial and mineral enterprises and public institutions, the progress of the employment-related action, and the progress of other resettlement activities. The sample form of the internal monitoring report on the progress of LAR is shown as Table 10-1; (iv) Resettlement budget and implementation. The amount and time of payment of resettlement fund to various levels, the use and management of resettlement fund of ROs at various levels, the amount and time of payment of compensation fund to the proprietor of affected property (house) and the proprietor (village and group) and the user of affected land, the use and management of compensation fund of the collective land at village level, the supervision and audit of the use of fund. The sample form of the internal monitoring report on the progress of the use of compensation fund is shown as Table 10-2; (v) Production and employment resettlement of displaced persons. The main measures for the resettlement of rural displace persons, the number of persons, the employment resettlement of the staff of displaced enterprises, the resettlement of vulnerable groups (household of women, household of old persons and the disabled), the recovery of the land occupied temporarily, and the effect of resettlement; (vi) Reconstruction of displaced houses and living resettlement. The means and areas of the resettlement of rural displaced persons, the way of house reconstruction, the three accesses and one leveling of the residential area, the payment of compensation fund, and the relocation of the matching public facilities (water supply, power supply, road, and business area); (vii) The reconstruction of the enterprises and public institutions and various specific facilities (power supply, water supply, communication, traffic, and pipelines); (viii) Complaint, appeal, public involvement, negotiation, information publicity and independent monitoring: The channel, procedure and responsible organization of complaining and appealing, the main complaints and appeals and their handling, main content and means of public involvement and negotiation, the effect of public involvement and negotiation, resettlement information brochure and information publicity, the activities and effect of independent monitoring organization; (ix) Handling of the relevant issues stated in the inspection memorandum of the ADB; and (x) Existing problems and solutions.

10.1.4 Methods of Internal Monitoring

218. The internal monitoring, as the from top to bottom monitoring on the implementation of the resettlement within the resettlement system, shall establish standard, smooth, and from top to bottom resettlement information management system among the Owner and ROs at various levels and follow up the progress of resettlement in various districts. The ROs at various levels shall report the progress of resettlement and the information about the compensation fund and the effect of resettlement from the bottom to top analyze and handle 99 relevant issues through the information management system. 219. The RO of the DUCIAM has established a complete information management system, which can save and manage various data and information relating to the implementation of project comprehensively, timely and accurately. 220. The following methods of internal monitoring may be adopted for this project in accordance with the implementation status of the project: (i) Standard report forms The Owner shall, in accordance with the requirements of resettlement implementation, design uniform report forms, which show the progress of appropriation of resettlement fund and the progress of LAR. The report forms shall be submitted at every end of month from lower level to superior level, through which the Owner can master the progress of the project. (ii) Regular and irregular communication The ROs at all levels shall discuss the problems occurred in the resettlement and communicate relevant information and propose their comments on handling these problems by a variety of means. (iii) Regular coordination meeting At the beginning of every month, the resettlement division of the DUCIAM will convene resettlement coordination meeting and the staff of district RO shall report the progress of the implementation and existing problems, communicate the working experience and seek for the solution of the problems. (iv) Inspection The resettlement division of the DUCIAM will carry out routine inspection and specific inspection on the ROs of lower levels and field survey, handle resettlement problems on site and verify the progress of the resettlement and the implementation of resettlement policy. (v) Information communication with independent monitoring organization The Owner and the local ROs shall keep in touch with the independent monitoring organization and take their findings and comments as the basis of internal monitoring. (vi) Resettlement MIS The RO of the DUCIAM will create a resettlement MIS for the project to store all relevant information. The data and information of the resettlement MIS will be updated during the RP implementation to ensure effective supervision on the resettlement.

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Table 10-1: Land Acquisition and Resettlement Progress Organization:______Date: ______/____/______(Y/M/D)

Accumulated Planned Completed Resettlement activity Unit completed % amount amount amount Permanent land acquisition mu Temporary land occupation mu House relocation m2 Including: Private house m2 Store m2 Premise of enterprise and m2 public institution Ten Land compensation thousand CNY Ten Payment of house thousand relocation fee CNY Reconstruction of m2 residential house Reconstruction of store m2 Reconstruction of premise m2 of enterprise and public institution Filled by: Signature of Person in Charge: Seal:

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Table 10-2: Progress of Using the Compensation Fund _____ District_____ Town (Street) ______Village (Community) Date /____/___ (Y/ M/ D)

Compensati Accumulate Brief Qty Amount on acquired d acquired Affected organization descripti required % (organi in the report Compensati on zation) (CNY) period (CNY) on (CNY)

Village

Village collective (Community)1 Household

Village

Village collective (Community)2 Household

Store

Enterprise and public institution

Public facility

Filled by: Signature of Person in Charge: Seal:

10.1.5 Internal Monitoring Agency and Personnel Assignment

221. The personnel of resettlement agency relating to internal monitoring are shown in Table 10-3.

Table 10-3: Personnel of Internal Monitoring in Resettlement Agency

Number of standing Number of personnel in peak Resettlement agency personnel period Resettlement office of the Dingxi 2 3 Urban Investment Company Dingxi Housing Demolishment 3 4 Company Village committee (community) 1 3

10.1.6 Responsibility of Internal Monitoring Agency

(i) Establish office, and train the workers to survey impacted areas; (ii) Invite independent monitoring agency; (iii) In the beginning, instruct the survey of the investigation agency; (iv) Train the workers of subcomponent RO;

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(v) Supervise and check the consistence between resettlement policies and the RP; and (vi) Supervise the information of APs and prepare resettlement handbooks. 222. For the problems discovered in internal monitoring, the RO of the DUCIAM will provide timely improvement measures.

10.1.7 Cycle of Internal Monitoring and Reporting

223. The internal monitoring is a continuous process and its overall monitoring activity shall be carried out at least once a quarter and its frequency will be increased during the key period of the relocation of the displaced persons. 224. During the preparation period of the project, the internal monitoring agency will make regular and irregular report, combining with the inspection of the ADB. The format of the report will be determined in accordance with the requirements of ADB and different projects and stages. After the implementation begins, the district RO is required to make brief monthly report and detailed quarterly, half-yearly and yearly report for major changes and progress of subprojects and make brief quarterly report and detailed half-yearly and yearly report for minor changes and progress of subprojects. Specific report shall be made according to the requirement of project management. After the implementation of the project, a final report shall be made. The internal monitoring report shall be submitted to the DMG at the same level, the RO at superior level and the Owner by the ROs at various levels. And the Owner shall submit an internal monitoring report to ADB every half a year.

10.2 External Monitoring

225. In accordance with the relevant requirements of ADB, an external agency will committed to undertake the external monitoring of the resettlement of the Project upon the comparison of the resettlement division of the DUCIAM and it will monitor and evaluate the resettlement and recovery activities to ensure the resettlement is implemented in conformity to the RP.

10.2.1 Purpose of External Monitoring

226. In the external M&E, the resettlement evaluation shall be made by a firm or institute independent of the governmental department. Its purpose is to inspect the implementation of the RP from a broad and long-term view; to monitor and evaluate whether the aims of land acquisition, resettlement, and relocation are reached; to propose comments and suggestions; and to take remedial measures and follow up their implementation and effects to ensure the result of the resettlement. 227. The external monitoring shall follow up the LAR to monitor and evaluate the following: (i) Whether the relevant rules and regulation of the state are observed in the resettlement, (ii) Whether relevant policies on involuntary resettlement of ADB are observed in the resettlement, (iii) Whether carry out the Resettlement Plan strictly, and (iv) Whether the living conditions of the affected population are improved or recovered.

10.2.2 External Monitor and Personnel

228. To carry out the external monitoring of this project successfully, an independent 103 monitor will be recruited by the DPMO. The following factors have been taken into consideration for the selection of team members for resettlement monitoring. (i) The independent monitoring personnel shall have the experience of similar work and abundant experience in socioeconomic survey; understand the involuntary resettlement policies of ADB, master relevant rules and laws of the state and local government on the resettlement. (ii) They shall be industrious and capable of carrying out social survey and research independently and have communication ability. (iii) Some female staff shall be assigned according to a certain proportion.

10.2.3 Assignments of the External Monitor

229. The external monitor shall undertake the following (i) Before the resettlement, the living standard baseline survey shall be carried out to master the basic living and production conditions of the displaced persons. (ii) In the process of the resettlement, the external monitor shall follow up and monitor the implementation of the resettlement, collect the comments and complaints of the displaced persons and report them to the resettlement division of the DUCIAM and local RO timely. And the external monitor shall submit monitoring report to the resettlement division of the DUCIAM and ADB. (iii) The external monitor shall investigate the living and production conditions of the displaced persons all the time and evaluate the resettlement activities and relevant measures. (iv) Upon survey, research and discussion with the displaced persons, the external monitor shall propose constructive comments to the resettlement division of the RO of the DUCIAM and local RO to ensure the smooth implementation of the resettlement and fast recovery of the living and production conditions of the displaced persons.

10.2.4 Means and Procedures of External Monitoring

230. The external monitor will adopt the following means to carry out the monitoring of resettlement. (i) On the basis of the detail survey and measure, the external monitoring organization will set up a database for the displaced persons and carry out door-to-door interview constantly. The external monitoring organization will fully make use of the information acquired through socioeconomic survey and the resettlement information management system of the project management office, carry out dynamic management on the basic conditions of the displaced households, and get to know the relevant information of the displaced persons all the time. According to the information shown in the database, the monitoring personnel will visit the displaced persons, get to know the progress of the resettlement, collect their complaints and suggestions, and inform them relevant policies of the state, relevant requirements of ADB and the information on the construction of the project. (ii) In the area affected population concentrated, workshops should be organized from time to time in order to collect APs‘ comments on major issues (iii) Field survey. The staff of the external monitoring organization shall visit the resettlement area regularly and irregularly and observe the resettlement on site.

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(iv) Survey on individual case. The monitoring personnel shall put emphasis on the special case occurred in the resettlement, analyze the causes of the problems, work out solutions, and propose suggestions. (v) Questionnaire. The monitoring staff shall carry out sampling survey on the recovery of the living and production conditions of the displaced persons and the comments on the resettlement and analyze the result in time to solve the existing problems. And the resettlement work of the next year may be carried out with reference to the results of the survey and the solutions of the problems occurred.

10.2.5 Contents of Independent Monitoring

1. Resettlement Monitoring of the Affected Enterprises and Public Institutions 231. The independent monitor shall follow up the resettlement of the enterprises and public institutions through phone call and the study on individual case. The following will be most concerned about: (i) Whether the time of land acquisition and the resettlement is arranged reasonably, (ii) Whether the losses of the affected enterprises are compensated, (iii) Whether the staff of the enterprises are resettled properly, (iv) Whether the production of the enterprises is resumed in time, and (v) Whether the affected enterprise transfer their loss to their staff. 2. The Resettlement of Displaced Persons 232. Rural residential houses are involved in this project. The resettlement of displaced persons is the emphasis of the independent monitoring. As to these displaced persons, the following are the main concerns of the independent monitoring organization: (i) Whether the compensation rates of houses and other attachments to the ground are determined in accordance with the replacement cost principle, (ii) Whether the compensation is paid with full amount and in time, (iii) Construction and distribution of relocation houses, (iv) Whether the time of relocation is arranged reasonably, (v) Whether the transition allowances and moving cost are paid, (vi) Whether the physical losses are fully compensated, (vii) Whether the infrastructure (including water, power and heat supply and roads) of the new resettlement area is completed and who is responsible for it, and (viii) Whether it is convenient to go to hospital and school from the new resettlement area. 3. Monitoring of Land Acquisition 233. In accordance with the features of the land acquisition of this project, the external monitoring on the land acquisition and production resettlement shall be focused on the following: (i) Whether the compensation rates of various lands are determined in accordance with relevant laws of the state; 105

(ii) Whether the transfer procedure of land compensation fund can ensure the affected village and group to acquire their deserved amount; (iii) Whether the amount of land acquired, compensation rate, and compensation amount are publicized in the village and by which means they are publicized; (iv) Whether a definite and feasible plan is made for the collective use of land compensation; (v) Whether the plan of the use of land compensation is designed after the collection of the comments of related villagers and how the use plan is finally determined; and (vi) How the benefit brought by land compensation is distributed and how the actual economic benefit of the displaced persons is guaranteed. 4. Monitoring of ROs 234. Capable, specialized, and efficient ROs may assure the success of resettlement. The monitoring on the operation of ROs is an important part of independent monitoring. The means of monitoring are mainly visits to the ROs and the inspection on the working data and record. The main content of monitoring on ROs includes (i) Whether the personnel structure of the ROs at various levels meets the requirements of the resettlement, (ii) Whether necessary working conditions are provided for the ROs at various levels, (iii) Whether the quality of resettlement personnel meets the requirements of the resettlement, (iv) The resettlement staff training, and (v) The internal data and information management of the ROs. 5. The Resettlement of Vulnerable Groups 235. The vulnerable groups shall be given special attention not only by the ROs but also by the independent monitoring organization. The independent monitoring organization shall follow up and monitor the resettlement of vulnerable groups by means of door-to-door interview, questionnaire, individual case analysis, and the main indicators of monitoring include (i) Which preferential policies are enjoyed by vulnerable groups in the resettlement; (ii) Whether the affected poor household in the urban area can afford a new house and have their living standards improved; (iii) Whether special requirements of affected women have been fully considered in the design of resettlement measures; (iv) Whether vulnerable groups, especially women, can acquire employment opportunity relating to the project and how many vulnerable persons are employed in the construction of the project; and (v) Whether there is a female staff member in each RO to deal with the affairs of women. 6. The Living Standard Baseline Survey of Displaced Persons 236. Before the formal commencement of the resettlement, the independent monitoring organization shall collect the basic information for the resettlement of the Project upon sampling survey. Structured questionnaires are adopted for the sampling survey. Cluster

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sampling shall be carried out, taking all the affected households involved in the socioeconomic survey at the preparation phase of the project as the sample bank. The sampling proportion for living standard baseline survey is determined to be 10–20%. 237. The living standard baseline survey of the affected households covers family structure, production conditions, gross floor area of the houses, annual income of the household, employment structure, annual expenditure of the household, traffic conditions, water supply, power supply and heat supply conditions, living environment, and subjective appraisal of production and living conditions. 7. The Effect of Resettlement 238. After the implementation of the resettlement, the external monitoring organization will follow up and monitor the effect of the resettlement continuously. 239. The external monitoring organization will investigate the affected households half a year after the resettlement. The follow-up survey is similar to the living standard baseline survey of the affected households, adopting sampling survey by means of structured questionnaires, to show the impact of resettlement on the production and living of the persons investigated. And the effect of resettlement shall be evaluated on the basis of the follow-up survey. 240. The principle of the selection of samples of the follow-up survey is the same as that of living standard baseline survey. The external monitoring organization shall try to investigate the objects of living standard baseline survey. After the living standard baseline survey, the independent monitoring personnel shall establish the database of the samples of the survey, which will be the basis of the follow-up survey. As to the survey objects that it is hard to investigate again due to various reasons, they shall be replaced by similar affected households in the same community after referring to the information bank established upon the earlier socioeconomic survey. 241. The contents of the follow-up survey shall be consistent with those of living standard baseline survey, so as to carry out comparison analysis of the production and living conditions of the affected households before and after the resettlement. Meanwhile, the subjective comments on the resettlement of the displaced persons shall be collected and they will be referred to in the evaluation of the effect of the resettlement.

10.2.6 Reporting System for Independent Monitoring

242. The external monitor shall make external monitoring report in written form based on the information acquired through observation and survey. The two purposes of reporting: one is to report the progress of the resettlement and existing problems objectively to the DPMO and the Owner; and the other is to evaluate the social and economic effects of the resettlement, propose constructive comments and suggestions to improve, and perfect the resettlement. 243. The external monitor shall submit reports to the DPMO and the Owner and ADB as planned schedule in Table 10-4, and the periods of reporting are confirmed as follows: (i) Conduct a survey on the AP‘s living standards and situation and submit a resettlement baseline report at the very beginning of resettlement implementation, (ii) Conduct investigations and submit a monitoring and evaluation report every six months in February 28th and August 31st, respectively until LAR including house relocation activities are completed, (iii) Conduct two annual evaluations and submit reports to verify the resettlement has restored the livelihoods, incomes and living standards of APs, and 107

(iv) Prepare and submit a resettlement completion report to the DPMO and the Owner after completion of resettlement of all subprojects. Table 10-4: Schedule Plan of Report Submission

Report Number Submission Date

External Monitoring Report No.1 31 December 2012

External Monitoring Report No.2 30 June 2013

External Monitoring Report No.3 31 December 2013

External Monitoring Report No.4 30 June 2014

External Monitoring Report No.5 30 June 2015

External Monitoring Report No.6 30 June 2016

244. A monitoring report shall at least include the following: (i) monitoring objects; (ii) the progress of the resettlement; (iii) main findings of the independent monitoring organization; (iv) main existing problems; and (v) basic appraisal, comments, and suggestions of independent monitoring organization. 245. The external monitor shall submit the report both in English and in Chinese to the DPMO and ADB. Before submitting, the external monitoring organization shall inform relevant personnel of the RO of the contents of the report and collect their comments and they shall communicate with each other on the contents and the form of the report.

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ANNEX I. REHABILITATION PLAN OF AP’S PRODUCTION 246. The annual interest of land compensation fees will exceed the loss of annual income. The return analysis without risk of the APs is presented in Table AI-1. In fact, APs can‘t save all compensation into banks because they need the compensation for improving agricultural structures or opening other small businesses. Therefore, the analysis is only a demonstration of replacement value.

Table AI-1: Return Analysis of APs

Area Interest Interest Minus Village Group Loss Compensation Acquired from Bank Loss mu CNY CNY CNY CNY 1 22.84 22,835 959,550 28,786 5,951 2 44.74 44,740 1,880,020 56,401 11,661 5 70.54 70,540 2,964,161 88,925 18,385 Bailin 6,7 304.86 30,4861 12,810,580 384,317 79,456 8 34.20 34,200 1,437,101 43,113 8,913 10 38.36 38,360 1,611,926 48,358 9,998 12 3.73 3,730 156,738 4,702 972 Beiershipu Xieheping 2.55 2,550 107,154 3,215 665 Donghe Shilipu 36.70 36,700 1,542,171 46,265 9,565 Xiershi Bozhihe 30.50 30,500 1,281,641 38,449 7,949 Total 589.02 589,016 24,751,041 742,531 153,515 Note：Annual income loss is based on CNY1,000 per mu and annual interest income is based on interest rate of 3.0% per year.

247. Compensation Standard for farmland is CNY40,020 per mu. Based on the annual interest rate of 3.0%, the annual return of the farmland compensation is CNY1,200.6, higher than annual income from each mu of farmland (CNY1,000). Namely, the interest of the compensation can offset the land loss. Moreover, the project construction will attract more investments and create more job opportunities. Through the project training program, the competitiveness of the APs will be enhanced. Assumed that one individual works 6 months each year, the total income can be CNY12,000. Their excess house may be rented out with the improvement of the transportation. Assumed that the rent is CNY150–200 each room, the annual rent income will be CNY1,800–2,400. 248. Among total 323 affected households, 67 households will lose less than 10% of their land holding, averaging 7.87%; 209 households will lose 10 to 30% of land holding, averaging losing 15.69%; and 47 households will lose 30 to 70% of land holding, averaging losing 37.55%. The HHs with land loss less than 10% can decide their own restoration. Their compensation can be deposited in bank to gain interest without any risk. More detailed analysis on remaining 256 HHs with land loss between 10%-70% is presented in Tables AI-2 to 3. 249. As presented in Table AI-2, average land loss proportion of 256 households (land loss is more than 10% of their contracted farmland) is 19.87%, and average farmland per capita is reduced from 0.22 mu to 0.51 mu. According to the consultation, economic restoration measures should be adopted as follows: (i) grow economic crops instead of grain crops, for example, plant potato or herbs instead of wheat; (ii) engage in non-agriculture, such as small enterprises or restaurant; and (iii) obtain interest from compensation. Production restoration 109 program is presented in Tables AI-3 and AI-4; input/output is presented in Table AI-4. As presented in Tables AI-3 and AI-4, the net income after compensation and resettlement is higher remarkably than the income before resettlement. (i) Restoration measures for the 209 HHs with land loss between 10 to 30% 250. Deposit part of the compensation fees in bank (CNY40, 020/mu); grow 306 mu of potato, 22 mu of herb, 1,509 mu of wheat; run nine (9) farm restaurants; rent out 10 shops. The total input will be CNY3,726,477, while its output will be about CNY41,414,042. In addition, the bank interest will be about 327,854. The total income will be CNY4,462,896. Compare to the income before LA, the income increased by CNY736,420. (ii) Restoration measures for the 47 HHs with land loss between 30 to 70% 251. Deposit part of the compensation fees in the bank (CNY40, 020/mu); grow 75 mu of potato, 15.5mu of herb, 230.6 mu of wheat; run 6 farm restaurants; rent out 3 shops. The total input will be CNY1,548,764, while its output will be about CNY1,603,190. In addition, the bank interest will be about 323,369. The total income will be CNY1,926,559. Compare to the income before LA, the income increased by CNY736,420. Compare to the income before LA, the income increased by CNY377,795. 252. In the process of resettlement implementation, the APs‘ willingness will be respected. External monitoring institution will monitor the income restoration.

Table AI-2: Impact of Affected Households (land loss>10%)

Farmland Remaining HH Population Labor LA Proportion Village Group before LA Farmland HH person person mu mu % mu 1 13 56 29 122.30 21.40 17.5 100.90 2 19 82 43 198.50 30.54 15.39 167.96 5 26 112 58 296.60 70.54 23.78 226.06 Bailin 6,7 127 546 284 1,48.70 274.36 18.94 1,174.34 8 15 65 34 177.50 33.35 18.79 144.15 10 23 99 52 179.60 33.69 18.76 145.91 12 2 9 5 20.30 3.73 18.37 16.57 Beiershipu Xieheping 2 9 5 13.20 2.00 15.15 11.20 Donghe Shilipu 14 60 31 103.90 34.40 33.11 69.50 Xiershi Bozhihe 15 65 34 132.50 30.50 23.02 102.00 Total 1,103 575 2,693 531 19.72 2,162.00

Table AI-2: (1) Restoration and Income Estimates of Affected Households

(land loss between 10 to 30%)

Affected Present Land Plantation Compensation Village Group HHs Farmland Acquired Income HH mu mu CNY CNY 1 13 122.3 21.4 122,300 897,358 Bailin 2 16 167.3 19.0 167,300 800,080 5 19 215.4 40.3 215,400 1,695,127

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Affected Present Land Plantation Compensation Village Group HHs Farmland Acquired Income HH mu mu CNY CNY 6,7 98 1,118.5 153.1 1,118,500 6,431,793 8 13 153.2 23.7 153,200 994,620 10 20 156.4 25.2 156,400 1,058,509 12 2 20.3 3.7 20,300 156,738 Beiershipu Xieheping 2 13.2 2.0 13,200 84,042 Donghe Shilipu 12 88.6 26.3 88,600 1,105,152 Xiershi Bozhihe 14 123.7 27.2 123,700 1,142,971 Total 209 2,178.9 341.9 2,178,900 14,366,390

Note: Compensation = Acquired Land Area X Compensation Standard

Table AI-2: (2) Restoration and Income Estimates of Affected Households

(land loss between 10 to 30%)

Affected Farm Potato Herb Wheat Shop Village Group HHs Restaurant HH mu mu mu HH HH 1 13 10.0 0.0 90.9 0 0 2 16 15.0 0.0 133.3 0 0 5 19 14.0 0.0 161.1 3 4 Bailin 6,7 98 160.0 20.0 785.4 5 6 8 13 28.0 1.0 100.5 1 0 10 20 35.0 1.0 95.2 0 0 12 2 5.0 0.0 11.6 0 0 Beiershipu Xieheping 2 5.0 0.0 6.2 0 0 Donghe Shilipu 12 20.0 0.0 42.3 0 0 Xiershi Bozhihe 14 14.0 0.0 82.5 0 0 Total 209 306.00 22.00 1,509.0 9 10

Table AI-2: (3) Restoration and Income Estimates of Affected Households

(land loss between 10-30%)

Net Income Difference Affected Total Interest Total of after and HHs Input Income Income Village Group Plantation before LA HH CNY CNY CNY CNY CNY 1 13 46,461 105,420 25,526 130,946 84,485 2 16 68,349 155,080 21,952 177,032 108,683 Bailin 5 19 1,176,563 1,172,858 18,216 1,191,074 14,511 6,7 98 2,069,689 2,112,970 130,863 2,243,833 174,144 111

Net Income Difference Affected Total Interest Total of after and HHs Input Income Income Village Group Plantation before LA HH CNY CNY CNY CNY CNY 8 13 208,096 234,056 23,595 257,651 49,555 10 20 66,256 154,170 29,767 183,937 117,681 12 2 8,320 18,860 4,453 23,313 14,993 Beiershipu Xieheping 2 5,941 13,460 2,343 15,803 9,862 Donghe Shilipu 12 31,473 71,340 32,210 103,550 72,077 Xiershi Bozhihe 14 45,329 102,828 32,929 135,757 90,428 Total 209 3,726,477 4,141,042 321,854 4,462,896 736,420

Note: 1. Plantation net income = area of farmland multiples net income each mu (see Table 6-8). 2. Interest income = one-year interest of compensation fund after deducting the investment for plantation X 3.0%).

Table AI-3: (1) Restoration and Income Estimates of Affected Households

(land loss between 30 to 70%)

Affected Present Land Plantation Compensation Village Group HHs Farmland Acquired Income HH mu mu CNY CNY 1 0 0.00 0 0 0 2 3 31.20 11.5 31,200 483,242 5 7 81.20 30.2 81,200 1,269,034 Bailin 6,7 29 330.20 121.3 330,200 5,097,147 8 2 24.30 9.7 24,300 406,763 10 3 23.20 8.5 23,200 357,179 12 0 0.00 0.0 0 0 Beiershipu Xieheping 0 0.00 0.0 0 0 Donghe Shilipu 2 15.30 8.6 15,300 362,221 Xiershi Bozhihe 1 8.80 3.3 8,800 138,669 Total 47 514.20 193.1 514,200 8,114,255

Table AI-3: (2) Restoration and Income Estimates of Affected Households

(land loss between 30 to 70%)

Affected Farm Potato Herb Wheat Shop Village Group HHs Restaurant HH mu mu mu HH HH 1 0 0.0 0.0 0.0 0 0 2 3 7.0 1.0 11.7 0 0 Bailin 5 7 14.0 1.0 36.0 0 0 6,7 29 50.0 52 106.9 5 2

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Affected Farm Potato Herb Wheat Shop Village Group HHs Restaurant HH mu mu mu HH HH 8 2 2.0 12.6 2.1 1 1 10 3 2.0 1.0 11.7 0 0 12 0 0.0 0.0 0.0 0 0 Beiershipu Xieheping 0 0.0 0.0 0.0 0 0 Donghe Shilipu 2 0.0 0.0 6.7 0 0 Xiershi Bozhihe 1 0.0 0.0 5.5 0 0 Total 47 75 15.5 230.6 6 3

Table AI-3: (3) Restoration and Income Estimates of Affected Households

(land loss between 30 to 70%)

Net Income Difference Affected Total Interest Total She of after and Village HHs Input Income Income Plantation before LA HH CNY CNY CNY CNY CNY

1 0 0 0 0 0 0

2 3 11,498 30,014 14,152 44,166 32,668

5 7 26,696 64,478 37,270 101,748 75,052

Bailin 6,7 29 1,183,389 1,196,550 119,104 1,315,654 132,265

8 2 313,519 277,194 127,511 404,705 91,186

10 3 8,288 22,754 10,467 33,221 24,933

12 0 0 0 0 0 0

Beiershipu Xieheping 0 0 0 0 0 0

Donghe Shilipu 2 2,951 6,700 10,778 17,478 14,527

Xiershi Bozhihe 1 2,423 5,500 4,087 9,587 7,164 Total 47 1,548,764 1,603,190 323,369 1,926,559 377,795 113

Table AI-4: Input and Output Analysis – Unit Input Cost and Output Income Potato Herbs Wheat Farm restaurant or shops Building Square Seeds CNY/mu 180 Seedlings CNY/mu 500 Sow CNY/mu 45 80 Houses meters Organic CNY/mu 140 Organic Fertilizer CNY/mu 600 Fertilizer CNY/mu 115 Seats Person 50 Fertilizer Employees CNY/mu 222 chemical fertilizer CNY/mu 100 Seeds CNY/mu 13.5 Initial Input Building Input Other CNY/mu 100 Insecticide CNY/mu 100 Irrigates CNY/mu 88 CNY 64,000 Houses Total CNY/mu 642 Employees CNY/mu 300 Insecticide CNY/mu 66 Decoration CNY 80,000 Other Input CNY/mu 250 Harvest CNY/mu 73 Total CNY 144,000 Annual Subtotal CNY/mu 1,850 Other CNY/mu 40 apportioned CNY 57,600 cost Output kg/mu 1,710 Subtotal CNY/mu 440.5 Attendance % 65 Turnover Price CNY/kg 0.80 Output kg/mu 100 Output 500g/mu 1,200 CNY 1,000 per day Cost per Output CNY/mu 1,368 Price CNY/kg 100 Price CNY/500g 1.2 CNY 610 day Output Net Net return One season 726 Output CNY/mu 10,000 Output CNY/500g 1,440 CNY 390 Income per day Annual Net Income CNY/mu 1,452 Net Income CNY/mu 8,150 Net Income CNY/mu 1,000 CNY 142,350 Income Net Income CNY 84,750

Note: Annual cost allocation is based on period of operation.

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ANNEX II. SOCIAL PENSION INSURANCE OF THE LANDLESS FARMERS

253. Anding District Government (ADG) will provide social pension insurance for villagers who lose their contracted land due to local urban infrastructure development. The detail measures include as follows: (i) ADG is responsible for providing the pension insurance for landless villagers uniformly, while different government divisions of labor safeguard, land resource, finance, and agriculture is responsible for the work according to this own duties. (ii) Villagers who lose their land totally shall be enrolled into the basic pension insurance system as same as urban residents. Their pension insurance will be provided in methods same to urban residents. (iii) Farmers whose acquired farmland is more than 80% of their total contracted land are considered as complete land losers. These farmers shall return their remaining contracted land to village committees and become urban residents. They shall be transformed from rural residency registration (rural Hu Kou) into urban residency registration (urban Hu Kou) and enrolled into the basic pension insurance system as same as urban residents with a unified account opened specially for the pension insurance system. They will not receive any extra compensation for the remaining farmland when they return it back to the village collectives. (iv) Farmers who sign the second round of land contract with village committees and over 16 years of age when the land is acquired shall participate in social pension insurance if the acquired land accounts for over 20% and less than equal to or 80% of their total contracted land. They are considered as partial land losers and shall have entirely-owned pension insurance account, which will be combined with the rural pension insurance system. (v) Farmers whose acquired land is less than 20% of their total contracted land will not be taken into the pension system temporarily. When they are involved in land acquisition in future, the total amount of lost land can be accumulatively calculated. (vi) Farmers whose acquired land is over 80%, but their living still can be supported by remaining land, can enroll into voluntarily the pension insurance as partial land losers. 254. The cost of the landless farmers‘ pension is paid by the individuals and the government, taking an approach of a lump sum paid in the land acquisition process, for which individuals pay 40%, subtracting from the land compensation fees and resettlement fees, and the government takes 60%. For state key construction sites, the government‘s part comes from the income of selling the land. The expenditure shall be taken into land acquisition costs. 255. Procedures to apply for the pension insurance include (i) village economic organizations and a village collective committee will discuss and check the application for the pension insurance required by APs, (ii) town governments or street administrative offices will publish the application and report it to relevant safeguard agencies of county or district governments, (iii) the social insurance agency in counties and districts will determine the amount of pension insurance that APs should pay, (iv) relevant land administrative agencies will inspect the application and process the cost for the insurance, and (v) the government financial department will set up special pension fund accounts for APs and conduct special management.

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APPENDIX I RESETTLEMENT INFORMATION BOOKLET

The ADB Financed Dingxi Urban Infrastructure Development Project

Resettlement Information Booklet

Respected：______Asian Development Bank (ADB) Financed Dingxi Urban Infrastructure Development Project (Project) will cover the place your family/working unit is located in, and this booklet is hereby issued in order to let you understand the general situation of the project, relevant land relocation policy of the country and affected family/working unit.

I. General situation of the project

Dingxi Urban Infrastructure Development consists of four components: (i) Road network (6 new roads and one expanded road); (ii) Bridge; (iii) Rainwater and sewage; (iv) Attachments, as presented in Table 1. The Project civil construction plans to start August 2012 and expect to be completed in November 2016.

Table 1: Project Roads

II. Laws and regulations and compensation rates in regard to land acquisition

(1) Major laws and regulations (i) The Law of Land Administration of the PRC (ii) Regulations on the Implementation of the Land Administration Law of the PRC (iii) Property Rights Law of the PRC (iv) The Suggestions of Gansu Provincial People‘s Government on Deepening Reform and Tightening Land Management

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(v) Method of Land Acquisition for Large Infrastructure Projects in Gansu (vi) House Demolition Management Regulations of Dingxi City (vii) ADB Safeguard Policy Statement

(2) Compensation policies on LAR for the Project

Category Compensation rate I. Land acquisition Young crop and ground attachments on collectively-owned land are compensation for compensated to the proprietor according to actual loss. affected households Compensation for the farmland: CNY 60/ m2; Seedling; CNY 3/ m2; and small non-farmland: CNY 45 / m2. businesses Compensation standards for residential real estate and structures of small businesses are : Brick-concrete: CNY606-765/m2 II. House Brick-wood: CNY462-606/m2 compensation for Brick-earth-wood: CNY351-510/m2 affected households Simple shed: CNY100/m2 and small Specific compensation will be evaluated by field survey. businesses Transmit subside: CNY40/person month; in total 12 month; Moving allowance: CNY2,400/HH (or each business). Rural housing site: CNY135/HH III. Compensation for loss of business CNY 15 / m2 of construction area of structures for business operation operation

These compensation standards are formulated on the basis of survey and investigation and in accordance with the laws and regulations of the PRC as well as the operational policy of involuntary resettlement by ADB, in order to restore and improve the standards of living of affected population after resettlement as soon as possible.

III. Resettlement plans and strategies Farmers to be affected by land acquisition will be compensated by Dingxi ADB Project Management Office (Dingxi PMO) according to the compensation standards in Section II. Affected land will be measured by the third party with supervision of Anding District National Land Administrative Bureau and villager committees and affected farmers. Amount of land compensation will be based on measures. There will be no land adjustment and reassignment in affected villagers. All of affected farmers will be compensated in cash. After signing agreement for the land acquisition, the cash will be deposited into farmers‘ bank account directly. Then the land will be acquired and used by the Project. Dingxi PMO will work with local government to provide relevant training program to affected farmers for improving their agricultural production and income. Farmers to be affected by house demolition will be compensated by Dingxi PMO according to the compensation standards in Section II. The house structures and quality will be evaluated and construction area of houses will be measured by an independent agency with supervision of village committees and affected farmers. Affected farmers have three options to receive the compensation: (i) in cash to buy apartment; (ii) in cash to build a new house by self; and (iii) with new apartment built by local government. 117

IV. Planned resettlement and project implementation schedule

Item Time Land acquisition and relocation announcement September 2012 Compensation payment October 2012 Land acquisition and relocation October 2012 – September 2013 Moving into new houses Before September 2013 Project construction October 2012 – November 2016

V. Rights and obligations of affected population

(1) Rights of affected people They should obtain compensations completely according to the above compensation rates and may reflect their ideas and suggestions to the ROs of villagers‘ committees/communities, towns/streets, districts and the city. (2) Procedure of Complaining and Appealing The Procedures of complaining and appealing are as follows although APs have the ability to access the civil legal system at all stages of the process: Phase 1 The displaced persons give their oral or written complaints to the village (community) committee or local RO. In case of oral complaint, the village (community) committee or local RO must keep a written record and give a clear reply within 2 weeks. If it is a big issue that shall be submitted to the superior RO, the village (community) committee or local RO shall try to get the comments of the superior RO within 2 weeks. Phase 2 If the reply given in the Stage 1 fails in satisfying the complainer, the complainer may appeal to the district RO within 1 month after receiving the decision of Stage 1. The district RO shall make a decision on the appeal within 3 weeks. Phase 3 If the complainer is dissatisfied with the decision of the district RO, he or she may appeal to the PMO RO or DUCIAM within 4 weeks after receiving the reply of stage 2. The PMO RO will give its comment within 4 weeks. If there are no agreements, administrative arbitration can be implemented. The ROs of the districts shall arrange the principals to collect and receive the complaints and appeals of the displaced persons. See for their names, office addresses, and telephone numbers below. Complaints can also be sent directly to ADB if the local grievance redress mechanism is not addressing their concerns. ADB will contact Gansu Provincial PMO to deal with complains or send officials to investigate and deal with complains. If an AP believes that ADB has not complied with their policy and this has lead to harm, APs may also submit a complaint in accordance with ADB‘s Accountability Mechanism (AM) 3 . AM will start investigation process to deal with complains.

3 Before submitting a complaint to the Accountability Mechanism, affected people should make a good faith effort to solve their problems by working with the concerned ADB operations department. Only after doing that, and if they are still dissatisfied, should they approach the Accountability Mechanism. For further information see: http://www.adb.org/Accountability-Mechanism/default.asp.

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Information of Organizations and Persons for Receiving Complaints and Appeals of Displaced Persons

(3) Obligations of affected population (i) They should actively cooperate with project construction. (ii) New buildings should not be set up within the range of survey after December 31, 2010, or there will be no compensation. (iii) They should demolish the buildings within the range of land for transportation.

VI. Assistance to vulnerable households

Vulnerable households will be given the following assistance: (i) Financial assistance. In the process of relocation, villages/communities should offer some subsidiaries to them. (ii) Assistance in labor service. Villages/communities give assistance to labor force responsible for relocation. (iii) Vulnerable households should have priority to select locations for building reconstruction and reallocated farmland.

VII. Land acquisition and relocation agencies

(i) Municipal agency Resettlement Office of the DUCIAM or Dingxi ADB Project Management Office Address: 12 Gongyuan Rd. Anding District, Dingxi City Postcode: 741000

Tel：0932-8235237 Independent External Monitor Address: TBD Tel: TBD

VIII. Booklet clarifications

The DUCIAM or Dingxi ADB Project Management Office can be contact for clarifications.

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Thank you for your support to this Project!

Dingxi ADB Project Management Office Dingxi Urban Construction & Investment and Asset Management Ltd Co.

March 2012