The Centre has offered to bear 50% of the project cost for building a suburban rail network, if the state can sanction Floor Space Index for the railway land.
The announcement has cleared an important barrier in the state's long-time demand of having a suburban rail network.
The state government fixes the FSI through local bodies to determine the stress a building would put on civic amenities. FSI in Bengaluru is called Floor Area Ratio and is decided by the plot size and width of the road, among other factors.
"We have studied the RITES report on the 160-km suburban railway for Bengaluru, about half of which will be on the elevated stretch," Railway Minister Piyush Goyal said on Thursday. "We will place (the plan) before the Railway Board and finance officials."
Goyal spoke after a surprise visit to the Krantiveera Sangolli Rayanna Station and a meeting with Parliamentary Affairs Minister Ananth Kumar, MP P C Mohan and officials of the South Western Railway's Bengaluru division.
While the new suburban rail policy announced last year fixed the Centre-state cost sharing ratio at 80:20, Goyal said it could be brought down to 50:50 if the state government increased FSI for railway land.
"I request the state to sanction 5 FSI (for railway land) towards transit-oriented development, on the lines of the (Devendra Fadnavis) government in Maharashtra," Goyal said.
Earlier, Kumar said the suburban project has been pending since he raised it in Parliament in 1996. "I've urged the railway minister to create the Bengaluru Railway Infrastructure Development Enterprise, which will work as a Special Purpose Vehicle to implement the suburban rail project," he said.
The parliamentary affairs minister said a full-fledged suburban rail network is the most essential transit solution for the city, as it could carry up to 35 lakh commuters a day.
In a tweet, Kumar said an in-principle approval has been given to invest Rs 12,000 crore to establish the suburban rail network. "It'll be operational by 2023," he added.