Sri City in Andhra Pradesh, Hosur in Tamil Nadu, Dahej and Dholera in Gujarat. Manesar in Haryana, Greater Noida in Uttar Pradesh, and Shendra-Bidkin and Navi Mumbai in Maharashtra. These new Gurgaons are promising to be new industrial and population hubs, taking away the pressure from overcongested New Delhi, Mumbai, Bengaluru, Chennai and Ahmedabad. Urban planning and development experts believe these new satellite cities that tap into the overflow from abutting megacities could be the real answer to India’s urban woes.
THE PRIVATE TOWN
Sri City, whose body is in Andhra Pradesh but soul in Chennai, brings a unique twist to the concept. This 40 sq km township is located only 55 km from Chennai, and is privately owned. It’s a distinct corporate-driven model that sets it apart from typical suburban areas. Of the 220 companies, predominantly multinationals, that have made Sri City their base, giants like Kellogg’s churn out cereal, Alstom builds metro coaches, Colgate-Palmolive produces toothbrushes, and PepsiCo bottles soft drinks.
Launched in 2008 in Tirupati district during the Special Economic Zone (SEZ) boom, this satellite city also boasts Asia’s largest chocolate factory. Confectionery titan Mondelez, known for its iconic Cadbury chocolate, set up its Rs 1,250 crore plant here in 2016, cementing Sri City’s status as a powerhouse for global brands. With four seaports and two airports—Tirupati and Chennai — within a 100 km radius, this satellite hub has become a magnet for global investors. “We are expanding residential options to create a ‘walk-to-work’ environment,” says Ravindra Sannareddy, founder and managing director of Sri City Pvt Ltd. The workforce is expected to grow from 62,000 to nearly 100,000 soon, with another 200,000 indirect jobs on the horizon, he says. Sri City is also home to Krea University that aspires to be an academic centre of international repute. Its governing council includes former RBI governor Raghuram Rajan and Nobel laureate Esther Duflo.
A QUIET BOOM
India’s G20 Sherpa Amitabh Kant says Shendra-Bidkin in Maharashtra and Dholera in Gujarat—both designed as sustainable industrial hubs with residential spaces—hold the same potential as Sri City. Shendra-Bidkin, situated near the industrial zones of Aurangabad, is being developed as a hub for export-oriented businesses, while Dholera is envisioned as a cutting-edge industrial smart city, with Tata Electronics recently establishing a semiconductor fab.
Dholera is about 100 km from Ahmedabad. Dahej, with its flourishing chemical industries, has capitalised on its coastal location to attract more businesses. Manesar benefits from seamless connectivity to Delhi, driving industrial growth and real estate development, says Kant, who was the CEO of the Delhi-Mumbai Industrial Corridor Development Corporation (now the National Industrial Corridor Development Corporation) in 2009-14.
“The Noida-Greater Noida region continues to thrive as a technology and manufacturing hub, benefiting from its strategic proximity to Delhi and extensive infrastructure, which attracts businesses and enhances residential opportunities,” he says. Kant’s list also includes Navi Mumbai with its upcoming international airport. He notes that these satellite cities do more than just alleviate the pressure on overcrowded metros. They open up new economic opportunities and are instrumental in fostering balanced regional growth.
URBAN LEGENDS
The introduction of GST in 2017 streamlined interstate trade, making a satellite city’s location across state lines irrelevant for businesses. This has fuelled growth in places like Hosur. It is in Tamil Nadu but has seen a surge in development due to its proximity to Karnataka’s capital Bengaluru.
Although cities occupy just 3% of India’s geography, they generate a substantial 60% of the country’s gross domestic product (GDP). Between 1970 and 2018, India’s urban population surged fourfold—from 109 million to 460 million—as noted in the 2018 Revision of World Urbanization Prospects published by the UN. The significance of cities—and the inevitable expansion of suburban areas and satellite cities—is underscored by projections that India will add another 416 million people to its urban areas by 2050, at which point half of the population will reside in cities. According to the 2011 Census, India had 7,935 towns and cities, a notable rise from 5,161 in 2001. While a city is typically larger than a town, the 2011 census, the most recent such count in India , used the term “Urban Area” to encompass towns and cities.
According to OP Agarwal, former urban transport specialist at the World Bank, satellite cities can be right next to a major city or 100 miles away. “What defines a satellite city is its strong connection to the main city, thanks to a robust transport network. It essentially rides on the metro’s foundational infrastructure. Take Gurgaon. It taps into Delhi’s universities and airport,” he says.
Agarwal says the emphasis of policymakers should shift to satellite cities and city clusters whether in linear or circular formations. “The bulk of India’s ambitious goal to grow its GDP from $3 trillion to $30 trillion by 2047 will have to come from urban areas,” he says. “This growth will largely spring from tier-2 and-3 cities, many of which are satellite cities.” He adds, “To attract investments, especially from manufacturing firms, satellite cities need to ensure essentials are in place— power, water, road connectivity, labour and more.”
Rumki Majumdar, an economist in Deloitte India, emphasises on smarter town planning and transport. “India will need smart urban planning and investment in connectivity so that satellite cities can become key engines for industrial expansion, innovation and job creation,” she says, stressing that decongesting major urban centres is essential for a more balanced distribution of economic opportunities. “By fostering regional development, satellite cities can offer people lower cost of living, improved infrastructure and a better quality of life. They will help attract companies and talent,” she adds.
GOING UP
When it comes to satellite cities, urban planners and policymakers are under growing pressure to develop vertical cities featuring 20-storey to 30-storey apartment buildings. “Metro rail and other public transit systems depend on population density, which is driven by verticalisation,” says Vinayak Chatterjee, an infrastructure expert and founder, The Infravision Foundation. He says for vertical growth to be truly sustainable, it must be matched with essential civic amenities like water and sewerage systems. “The success of any satellite city depends on enhanced transport connectivity,” he says.
For instance, Meerut, situated 80 km east of Delhi, has emerged as a thriving satellite city, with real estate prices soaring due to the development of an expressway and the upcoming regional rapid rail project. The completion of the 508 km Mumbai-Ahmedabad bullet train corridor, likely by 2028, will elevate the status of cities like Bharuch in Gujarat, which will have stops for the slower version of the bullet train that will travel from Mumbai to Ahmedabad in less than three hours.
As India’s major metros grow increasingly congested and almost unlivable, the chaotic expansion of suburban areas and satellite cities only intensifies the challenges of rapid urbanisation. “We still lack a cohesive policy to address areas adjacent to larger cities,” says M Ramachandran, former secretary in the Ministry of Housing and Urban Affairs, adding that the National Capital Region concept, an outcome of a legislative process, is an exception. “Cities like Bengaluru have absorbed nearby villages into their limits, but the downside is that they also inherit rural issues, such as outdated sewerage and water supply systems,” he says.
ROAD AHEAD
India’s policymakers have also overlooked the challenges posed by the rapid spread of “census towns”. These settlements resemble towns and have a population of over 5,000, with more than 75% of the male workforce engaged in non-agricultural work. Many of these are springing up between metros and their satellite cities. The number of census towns surged from 1,362 in 2001 to 3,894 in 2011, creating new headaches for urban planners.
Often governed by panchayats, these areas —such as Chikhli near Surat and Nandigram in the south of Kolkata— are rarely integrated into broader urban strategies.
“When a census town lies close to a city, there is a strong case for including it in the city’s overall planning,” says Ramachandran. He warns that the rapid construction of cities without careful planning or vision risks making these new urban areas unlivable. “In some respects, old metros still offer a better quality of life than emerging satellite hubs. For instance, Delhi has far more greenery than Gurgaon,” he says.
Despite hosting top companies like Accenture, American Express and Google, property prices in Gurgaon are 60% lower than that of Delhi. As of September 30, the average residential price in Gurgaon is Rs 9,500 per sq ft, compared with Delhi’s Rs 24,200, according to Anarock, a real estate consultancy firm. In Sohna, a little away from Gurgaon, properties are about 25% cheaper than in Gurgaon. Based on current real estate trends, Greater Noida, Navi Mumbai, Gurgaon, Sohna, and New Town in Kolkata are among India’s most prominent satellite cities, experiencing substantial growth over the past two decades and showing strong promise, says Anuj Puri, chairman, Anarock group.
“These cities are not just seeing high real-estate activity in terms of new supply and housing sales but have also seen high growth in average residential prices,” he adds. Among these, only New Town boasts higher average residential prices than its main city; a home here costs 14% more than in Kolkata, according to Puri’s analysis.
Urban planners and policymakers must adhere to a simple yardstick: the new satellite cities have to be more innovative, vibrant and aesthetically pleasing than the cities of the past.
Hope the National Conference of Chief Secretaries will take note.