Clearing the plan, the state cabinet said that the project will be a 38.2-kilometre project with two lines and will be completed in six years from the date of commencement.
The cabinet, however, did not give any date for the commencement of work.
The two lines include one running from Automotive Chowk to MIHAN (Multi-modal International Cargo Hub) and Prajapati Nagar to Lokmanya Nagar. MIHAN is a cargo hub and airport project currently under development.
The Nagpur Improvement Trust (NIT) appointed Delhi Metro Rail Corporation (DMRC) for a detail project report (DPR), which has been received by the cabinet. NIT is a local civic government body responsible for developing new areas within Nagpur city.
According to CM Prithviraj Chavan, a joint venture company will be formed with the state government, Centre, Nagpur Municipal Corporation (NMC) and NIT as partners to implement the project.
The project will have 20% stake from Central government, 20% holding by state government, NMC and NIT will hold 5% each and the remaining 50% will be raised through loans and other sources.
In Wednesday's meeting, the state cabinet also decided to be a part of the ongoing Delhi Mumbai Industrial Corridor (DMIC) as it gave its approval for the draft state support agreement and shareholders agreement of the 1,482-km project.
The state government plans to develop three inter-state connectivity routes that will give a boost to the ambitious DMIC project, Chavan said.
The roads would include Aurangabad-Nashik express highway, Karad-Sangameshwar and Shendra-Bidkin stretches. As a result of the project, he said, places such as Shendra, Bidkin, Dighi, Igatpuri, Dhule and Nardana will be developed as growth centres of the state.