Population resettlement, an integral part of settler colonialism, has also been practiced in post-colonial countries to obtain territorial control over the contested territories. Studies analyze resettlements in relation to settler-colonial and post-colonial states. The resettlement policies of the Nepali state, which has remained independent throughout its history, are outside their attention. Nepal relocated its dominant Hill Hindu high-caste people to the Tarai region to enhance economic growth and development. However, settlement projects hindered languages, cultures, customary laws, and natural resources of the Madhesi and the Tharu Indigenous Peoples, ultimately displacing them from their ancestral territories. In response, ethnic and Indigenous Peoples intensified their demands for autonomy and self-rule, which they considered as measures to prevent further erosion of their collective rights. This finding contests the prevailing theoretical explanations that population resettlement projects weaken ethnic solidarity, illustrating that settlement projects can also become a reason for heightening autonomy movements.