Cities offer agglomeration economies, thereby enabling more economic activities, better education, better healthcare and, overall, a better quality of life. This attracts people to cities in search of jobs and livelihoods.

India’s urban population, which stood at 371 million in 2011 is projected to grow to about 820 million in 2051. This is indeed a major demographic transformation. But urban population growth takes place in two broad ways:

1. When people migrate to urban areas from rural areas, as also with natural growth of the current urban population, and
2. When existing rural areas change the character of their predominant economic activity away from agriculture towards non-agricultural activities.

Both of these make a case for new cities to be developed. The first is because many of the existing large cities are becoming difficult to manage and creating new cities will make them more manageable. The second is provide urban amenities in erstwhile rural areas which have now acquired an urban character.
For creating new cities to accommodate the growing population in existing urban areas, satellite cities offer the unique advantage of enabling better manageability and let leverage the high cost infrastructure of the parent city. As an example, Gurugram, Faridabad, Ghaziabad, NOIDA, Rohtak and other cities around Delhi benefit from the airport, the important railway station, high quality universities and medical facilities in Delhi. These do not have to be invested in by the new city. If these new cities came up further away from the capital city, they would lose that advantage. This makes a strong case for developing new cities close to an existing large city.

However, rural areas that have acquired an urban character have done so due to some non-agricultural activities that have already come up there. They may or may not be close to an existing large city. There is a case for developing new cities here as there is some kind of economic base and can be a nucleus for a new growth center for the surrounding areas.

A very interesting study by the Institute of Social Sciences and HUDCO published recently as the State of Cities: India shows that there has been a spurt in “census towns” between 2001 and 2011. While India had only 1362 census towns in 2001, this number shot up to 3894 in 2011. The population residing in these census towns went up from 20.02 million to 54.28 million during the same period. This indicates the rapid of pace at which rural areas have shifted to non-agricultural economic activities and the urgent need to develop new cities at these locations.

Yet another reason for developing new cities is that many of the existing old cities were not designed for the kind of mobility we see today. They were designed for a predominantly walking or cycling pattern of travel and had narrow lanes. The old cities in Delhi ,Ahmedabad, Hyderabad, Bhopal, etc demonstrate this. New cities have become necessary at these locations to accommodate the current travel patterns and the kind of motor vehicles that have become necessary today.