BOKAPAHARI, India—This village may be as close as you can find on Earth to the biblical vision of hell. Coal fires rage just below the surface, making places too hot to walk barefoot. Noxious gases spew from fissures in and around houses, which frequently collapse. Thousands of residents live in this inferno, earning roughly $2 a day pilfering coal they sell in the local market. The central government has spent $5 million to build nearly 2,400 new apartments eight miles away to house residents of Bokapahari. So far, the residents are staying put. Residents say they have no way of...