15th Finance Commission (15th FC) has allocated ₹8,000 crore as performance based challenge fund for incubation of eight new cities. A State can have only one new city through this fund.

In line with the recommendations of 15th FC, the Ministry constituted an Expert Committee (EC) for finalization of bid parameters for incubation of new cities. The Committee finalized minimum eligibility conditions & bid parameters, and a Request for Proposal (RfP) was circulated to all States. The Ministry received 26 proposals from 21 States upto the last date. Due to non-receipt of qualitative proposals from North-Eastern States, fresh/revised proposals were sought from these States. Consequently, total 28 proposals from 23 States have been received.

All the proposals are at the competent level for examination/scrutiny.

To give impetus to the proposals from North-Eastern (NE)/Hilly States for incubation of new city, the preferred size of proposed cities is more than 25 Hectares. For all other States, preferred size of proposed cities is more than 50 Hectares. Envisaged population of the new city in NE and Hilly States is at least 25,000. For all other States, envisaged population is 1,00,000.

Further, considering the small urban population in NE/Hilly States, Rs. 500 crore for a city has been allocated. 

This information was given by the Minister of State for Ministry of Housing & Urban Affairs, Shri. Tokhan Sahu, in a written reply in the Lok Sabha today.

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