HUDCO Inks ₹1 Trillion Deal for Bihar Satellite Cities

PATNA — The Bihar government officially signed a Memorandum of Understanding (MoU) with the Housing and Urban Development Corporation (HUDCO) on Friday, July 3, 2026, to secure ₹1 trillion in long-term financing. This historic partnership is set to drive the development of 12 greenfield satellite townships across the state, marking a significant milestone in Bihar's urban expansion strategy.

The agreement was exchanged in the presence of Bihar Chief Minister Samrat Choudhary, who described the initiative as a "historic step" toward modernizing the state's urban infrastructure. The project spans over 300,000 acres, with the state government aiming to achieve an urbanisation rate of 35% through this large-scale urban planning effort.

A Massive Infrastructure Push

The ₹1 trillion funding provided by HUDCO is intended to be disbursed over the next five years. According to Bihar’s Deputy Chief Minister, while HUDCO’s contribution will serve as the financial bedrock, the state anticipates mobilizing an additional ₹6 trillion from private and institutional investors.

The proposed satellite townships are designed to be "future-ready," featuring world-class amenities including:

• Modern road networks and transport connectivity.

• Comprehensive drinking water and sewerage systems.

• Reliable power infrastructure.

• Dedicated green spaces, educational hubs, and healthcare institutions.

Impact on Development and Employment

Chief Minister Choudhary noted that the project is designed to be inclusive, utilizing a land pooling mechanism to ensure farmers remain stakeholders in the development process. The government has committed to processing compensation for land acquisition within 30 days of application.

Beyond providing high-quality housing, the massive scale of construction and infrastructure deployment is expected to act as a catalyst for economic growth, generating lakhs of direct and indirect employment opportunities across the region.

Official Sources

The MoU was signed between the Urban Development and Housing Department of Bihar and HUDCO. Key signatories included Principal Secretary of Urban Development Vinay Kumar and HUDCO Chairman and Managing Director Sanjay Kulshreshtha. The agreement received prior cabinet approval from the Bihar government.

Why It Matters

For residents, this project promises a transition from traditional rural living to world-class urban environments with integrated amenities. For the economy, it represents one of the largest infrastructure financing commitments in recent years, positioning Bihar as a key player in modern urban development. The massive capital influx is expected to boost construction activity and attract global interest in the state’s emerging satellite cities.

Key Facts at a Glance

• Total Investment: ₹1 trillion long-term financing from HUDCO over 5 years.

• Project Scope: Development of 12 greenfield satellite townships across 3 lakh acres.

• Urbanization Goal: Part of a state-wide push to reach 35% urbanization.

• Job Creation: Targeted to create lakhs of new employment opportunities.

FAQ

1. What is the primary purpose of the HUDCO-Bihar agreement? The MoU provides ₹1 trillion in term loans from HUDCO to finance the creation of 12 modern, planned satellite cities in Bihar.

2. How long will this funding be deployed? The financing is structured as a long-term arrangement to be executed over a five-year period.

3. How does this project impact local farmers? The project uses land pooling, where farmers become stakeholders, and the government has committed to clearing acquisition compensation within 30 days.

4. What facilities will these new satellite towns offer? They will include advanced road, power, water, and sewage systems, alongside schools, hospitals, and commercial zones.

Source: UNI India, ETV Bharat Bihar, Dainik Jagran