Hyderabad: The state government has released Rs 375 crore as the first installment for the Musi Riverfront Development Project, from the Rs 1,500 crore allocation made for this in the state budget 2026-27.
Special chief secretary to the metropolitan area and urban development department, Jayesh Ranjan, issued the orders on Wednesday, sanctioning the funds to the Musi Riverfront Development Corporation.
Of the sanctioned Rs 1,500 crore for the Musi project, Rs 375 crore has been released for the first quarter of the current fiscal. The remaining Rs 1,125 crore would be released in subsequent quarters.
Notably, the state government is simultaneously accelerating the execution of the ambitious Musi rejuvenation programme and pursuing the scope for external funding.
In the 2024-25 budget, the government allocated Rs 1,500 crore for the project but spent only Rs 11.25 crore. Similarly, in 2025-26, though Rs 1,500 crore was allocated again, only Rs 6.21 crore was tilised.
The funds could not be utilised as the detailed project report (DPR) for Musi was pending.
Chief Minister A. Revanth Reddy unveiled the DPR and master plan for the first phase of the Musi Riverfront Development Project on March 13. The project, with a phase-I cost of Rs 5,812.4 crore, aims to transform 55km of the polluted river into a vibrant, sustainable urban corridor with infrastructure like tourism hubs and bridges.
This time, apart from making fresh budgetary allocations, the government has also decided to secure a loan of Rs 4,100 crore from the Asian Development Bank for the first phase of the project. ADB reportedly gave its preliminary approval.
The government has also intensified land acquisition activities for the project. DPRs have already been prepared for a 21-km stretch under the first phase of the Musi rejuvenation initiative and submitted, as part of the ADB funding process.
The government has transferred several land parcels for the project, including lands earlier allotted to institutions such as IIPH in Premavathipet and Budvel areas of Rajendranagar mandal, as well as lands in Kismatpur and Himayatsagar regions of Gandipet mandal.
In Shamshabad mandal, around 734 acres earmarked for an HMDA layout in Kotwalguda has also been transferred for the Musi project. The government would allot alternative lands to these institutions in the proposed Future City.
The government has issued notifications for acquisition of nearly 50 acres. Notices have been served on several landowners and institutions located in the buffer zones between Himayatsagar, Osmansagar and Gandhi Sarovar. The acquisition process covers key areas including Kismatpur, Bandlaguda Jagir and Gandipet.
Notices have been issued for a 9.2 km stretch between Himayat Sagar and Gandhi Sarovar and an 11.8km stretch between Osmansagar and Gandhi Sarovar. Land acquisition enquiries were also initiated for properties in Hyderguda and around 50 villas in Keerthi Richmond Villas and Sun City areas.
MRDCL has invited landowners in the designated 50-metre buffer zones to voluntarily surrender their lands in exchange for the transferable development rights.
Compensation will be paid based on prevailing market values in accordance with the provisions of the Land Acquisition Act, 2013.
The Musi riverfront development project spans around 55 km from Gandipet to Gowrelly and is spread through 46 villages across 14 mandals in Hyderabad, Rangareddy and Medchal-Malkajgiri districts.
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