Laxmi Prasad Mainali of Ghailadubba, Jhapa is a worried man because he is up to his neck in debt, and has no means to repay it except his farm which remains frozen.

Last November, he took loans totalling Rs1.5 million for his daughter's wedding, some from his relatives and some from financial institutions.

He has to pay a high interest rate, and the interest payments have been piling up each passing month, said Mainali.

Agriculture is the only source of income for Mainali, and he has no other resources to repay the loan. His only asset is a 2-bigha farm, and he has planned to sell some of his land to raise cash.

But Mainali is in a fix because he has been told that he can neither sell the land nor take additional loans by keeping his land as collateral.

The alignment of the planned Kakarbhitta-Inaruwa Electric Railway passes near his property, and the government has frozen all land transactions for the past two years.

"As land transactions have been frozen by the railway project, it has become difficult for us to manage finances even during emergency situations," said Mainali. “The railway project neither pays us compensation nor releases our land.”

Around 5,000 families in Jhapa, Morang and Sunsari districts whose lands lie on the path of the proposed railway line are having the same problem.

Many farmers have been affected by the project which has stalled since it was launched in 2015.

The Inaruwa-Kakarbhitta railway in eastern Nepal forms a section of the Mechi-Mahakali East-West Railway. A detailed project report of the railway was started in 2015 and has been completed.

The length of the railway line is 106 km and it is estimated to cost Rs90 billion. The track will run parallel to Mahendra Highway 2 km to its south.

Trains will travel at a speed of 200 km per hour on the line. There will be 10 railway stations between Inaruwa and Kakarbhitta.

The government has frozen land transactions along the route to prevent price rises. All buying, selling or transferring activities have been stopped.

"The government has created such a difficult situation that for many people, it has become a trap. Many people are facing financial difficulties," said Khagendra Kharel a resident of Birtamod Municipality.

Kharel too had taken a Rs30.5 million loan from Excel Development Bank in Birtamod to start a business by keeping his 3.5-storey building and 7-kattha land as collateral.

Part of his property is located within the project site. Kharel says a few of his plots lie on the path of the railway, but the bank has been pressing him to repay the loan for the last two years.

"The bank asked me to make repayments on a daily basis when the pandemic hit my business,” Kharel said.

“I took additional loans from another bank by keeping other lands as collateral to repay the old loan. The project has created difficulties for many people,” Kharel said. No one knows when their lands will be released.

According to the Department of Railways, the Kakarbhitta-Inaruwa railway track passes through 62 wards in 18 municipalities of three districts.

As per the report, 512.69 hectares of farmlands, 53.61 hectares of river areas, 33 hectares of settlements and 19.60 hectares of forests will be affected. The project will take over ​​a 25-metre strip of land on either side of the track.

The department has said that more than 4,000 houses will be impacted by the construction of the railway line.

The District Administration Office, Jhapa had published a 35-day notice for land acquisition for the project on June 6, 2020. Three days later, another notice was published for land acquisition in Morang and Sunsari too.

According to the Land Revenue Offices of all three districts, 2,457 plots in Jhapa, 1,638 plots in Morang and 1,329 plots in Sunsari have been frozen for the railway project.

Mainali, coordinator of an ad hoc committee named Railway Affected and Compensation Coordinating Committee for all three districts, says the affected people are taking to the streets because land transactions have been blocked for a long time, and they have not received any compensation.”

Mainali said they had been continuously drawing the attention of the chief district officers of all three districts, the chief of the Railway Department and provincial ministers to resolve the problem. “But we have not heard from them,” he said.

Technicians from the Railway Department have completed erecting pillars on lands that lie fall under the railway.

Political parties, civil society and other organisations in the district have been urging the government to distribute compensation to the railway affected people and release the land.

The department estimates that Rs24 billion will be spent in land compensation for the Kakarbhitta-Inaruwa railway.

"We estimate that the compensation will run into more than Rs100 billion even at minimum land values," Mainali said.

Ranjit Prasai, general secretary of the coordination committee, says no separate allocation has been made for the Kakarbhitta-Inaruwa railway even in the budget statement that was issued recently.

"The budget speech has made us into a spectacle. Everything looks uncertain," he said. “There is no alternative but to launch a protest.”

The coordination committee has decided to meet the prime minister and the minister concerned and draw their attention first before starting their protest.