Govt shelves plan for greenfield cities as experts raise concerns

The Union government has shelved the scheme to incubate eight new cities, as recommended by the 15th Finance Commission (FC), according to senior government officials.

- Soumya Chatterjee

NEW DELHI:

A senior official at the Union ministry of housing and urban affairs (MoHUA), on condition of anonymity, said that ₹8,000 crore allotted for the scheme will now be subsumed under another new scheme.

A second official said that this new scheme may be designed based on ongoing deliberations between the ministry, NITI Aayog, and the Asian Development Bank (ADB) for infrastructure upgrades in smaller cities with a population of up to 100,000, as per the 2011 Census.

The decision to shelve the greenfield cities plan came after the Union government already received 26 proposals, including one for Ayodhya in Uttar Pradesh, Jagiroad in Assam, GIFT City expansion in Gujarat, Jabalpur Extension in Madhya Pradesh, Virul and Sawargaon Mal in Maharashtra, among others.

In many of these cities, the state governments had already started making investments of their own. Subsequently, after a second nudge, two more proposals from northeastern states were also received by MoHUA, according to a reply in the Parliament in December 2024.

The second government official said the decision to put the FC's proposed idea on the back-burner came from the Prime Minister's Office (PMO). The official said the PMO's decision was based on presentations made by interministerial groups along with the NITI Aayog and other stakeholders as part of preparatory meetings for the 100-day agenda of the new government in the first half of 2024.

This official said that instead of going for greenfield cities, the PMO has called for efficient investments in existing organic cities as the next "growth hubs" rather than developing new "cities from scratch".