Nepal, Oct. 28 -- More than a decade after floods swept away their homes along the Bheri River, displaced families in Surkhet are facing the prospect of losing their shelter once again, as forest authorities prepare to clear the land where they have rebuilt their lives.

At Palbazar in Panchapuri Municipality-5, what was once open land in Kalika Community Forest has developed into a settlement of houses, shops and paved roads. The settlement emerged after the August 2014 floods swept away Tikhakuna, a riverside settlement, forcing dozens of families to seek shelter in the forest.

Among them is Bhim Bahadur Shahi, who moved his shop from Babiyachaur, a major market in western Surkhet, to Palbazar. He is one of 93 families that began livin...