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This article analyses the impact of recent modernisation-led development on rural communities, emphasising particularly their loss of land and of access to common land. Displacement of rural communities from their natural habitats results in a host of socio-economic impacts. This study will focus mainly on farmers and tribal communities in India - as to how they have been affected by the modernisation process, especially since the adoption of neoliberal economic reforms. For a rural community the displacement is a traumatic both in terms livelihoods and from a cultural perspective. The paper analyses the issues of displacement of the villages that have been relatively isolated from the outside world. Modernisation-induced displacement becomes important due to its impact on the rural communities through land alienation which has resulted in protests by the affected communities. I find there is a gap in the literature regarding the impact of development projects on the socio-economic conditions of the rural communities.