A harsh internal report leaked to the press yesterday accuses the World Bank of violating its own environmental and human rights policies by agreeing to fund a controversial resettlement project in western China. The $40 million project, which the bank tentatively approved last year, seeks to move about 58,000 poor farmers to areas traditionally inhabited by ethnic Tibetans and Mongols. Critics say the project would dilute Tibetan ethnic identity, put more pressure on groundwater resources, and lead to pesticide and fertilizer pollution. The World Bank’s board is set to decide on July 6 how to proceed; some staffers have recommended a new 15-month, $2 million study of the project’s potential impacts.