The Chinese government has approved a $250-million plan to redevelop the Dalai Lama’s birthplace, a remote village called Taktser, into a modern city, state media reported on Friday.

Taktser, or Hongai in Chinese, is in the northwestern Qinghai province. The house where the Dalai Lama was born is still standing, and has become an important pilgrimage site for many Tibetans. In a rare acknowledgment of Taktser’s significance for Tibetans, the government also allocated 2.5 million Yuan ($400,000) to renovate and preserve the house under the larger urbanisation plan.

Gonpo Tashi, a nephew of the Dalai Lama who resides in Taktser, was quoted as saying he would follow “a special mission” to look after the house. “The refurbished compound has retained its original look”, the official Xinhua news agency said, “but the ground is newly paved, beams have been reinforced and murals were repainted”.

It said the government had, in October, allocated the 2.5 million Yuan from the central treasury to aid Gonpo Tashi’s “desire to protect his uncle’s old residence”, suggesting the government was looking to assuage any concerns that the urbanisation plan might threaten the village.

Chinese authorities have in the past adopted an ambivalent approach to Taktser, according to monks in the nearby Kumbum monastery.

Realising its significance for Tibetans, they have allowed pilgrims to visit the Dalai Lama’s house and invested small amounts in improving infrastructure and road access. However, access to the village has been blocked during politically-significant anniversaries.

The Xinhua report unusually acknowledged the reverence in which the Dalai Lama is held by most Tibetans in China. State media usually hit out at the Dalai Lama, accusing the exiled spiritual leader of being a “splittist”. Only on Thursday, the state broadcaster released a documentary accusing “the Dalai Lama clique” of encouraging the recent spate of self-immolation protests — a charge strongly denied by the Dalai Lama, who has called on China to examine its policies.

The report said “in addition to locals, pilgrims travel from other Tibetan communities in the neighbouring Gansu province and Tibet Autonomous Region (TAR)” to Taktser.

The prayer hall of the house has statues of the Buddha and of the Dalai Lama, according to the report. China has also allowed the nearby Kumbum monastery — an important site for Tibetan Buddhists — to display portraits of the Dalai Lama, though many monasteries in the Tibet Autonomous Region (TAR) have not been allowed to do so. Around half of China’s six million Tibetans reside in the TAR, with the remaining population in Qinghai, Sichuan, Gansu and Yunnan provinces.

The Xinhua report said some residents of Taktser were concerned about the urbanisation plan, which has been endorsed by the State Council, or cabinet. Residents said they were concerned that their livelihood, which depends on the lucrative local trade of the caterpillar fungus, might be impacted.

According to the plan, the provincial Qinghai treasury will allocate 1.5 billion Yuan ($244 million) to renovate roads and residential areas, build “commercial centres” and water treatment plants.

The nearby Pingan district will also develop a “high-tech industrial base” with new energy and information technology companies.

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