What Makes A City Tier I, II, III, and IV? Check List of These Cities in India

The tier system is bureaucratic and was formalised in part through central pay-commission recommendations and operationalised in administrative practice to simplify resource allocation. In practice, tiers sort cities by measurable things: population, economic activity, infrastructure and administrative importance. That is the backbone. It is not poetic. It is arithmetic and politics.

Tier status answers three basic questions. How many people live here? How much economic firepower does the city hold? And does the city host the institutions airports, major courts, secretariats that concentrate power and services? Where answers are “large, large, yes,” the city sits high in the hierarchy. Where answers are “small, limited, no,” the city sits low. That is the rule. And examples below make it concrete.

What makes a city Tier I?

Tier I cities are metropolitan by function, not merely by headline. They are defined by large populations (metropolitan centres, typically above one lakh historically in RBI shorthand but practically above many lakhs today), dense economic networks, broad infrastructure, and heavy administrative weight. Tier I cities host national and international firms, universities, specialised hospitals, major airports and often state or national institutions. They concentrate demand, capital, and problems like traffic, housing and bad air quality.

Tier I cities (2025) - In no particular order

Bangalore

Delhi

Chennai

Hyderabad

Mumbai

Pune

Kolkata

Ahmedabad

Why they are Tier I? 

Because they combine population scale, diversified GDP, advanced transport links (international airports, major rail hubs), and institutional clout. They are not just big but central to the country’s economic and administrative circuits. They set price benchmarks; they draw migrants; they fail publicly when systems break.

What makes a city Tier II?

Tier II cities are workhorses in transition. Smaller than the metros, yes, but often far nimbler. They show improving infrastructure, steady investment, and growing job markets. They are the places that industrial corridors and state policy consistently try to lift into greater prominence. A Tier II city still has constraints, less specialised healthcare, fewer international links but they are improving fast.

Representative Tier II cities (2025)

Amritsar, Bhopal, Bhubaneswar, Chandigarh, Faridabad, Ghaziabad, Jamshedpur, Jaipur, Kochi, Lucknow, Nagpur, Patna, Raipur, Surat, Visakhapatnam, Agra, Ajmer, Kanpur, Mysuru, Srinagar.

They are called Tier II because their populations and economies place them below the national hubs but above smaller regional towns. Importantly, infrastructure projects metros, regional airports, expressways can and do push them upward economically. They are the middle ground: affordable, growing, and politically useful.

What makes a city Tier III?

Tier III cities are smaller, often serving regional or district-level functions. They typically have populations in lower tens of thousands to a few lakhs, limited tertiary healthcare and higher education facilities, and narrower industrial bases. Yet they matter. They are the staging grounds for manufacturing clusters, logistic nodes, and spillover suburbs when Tier I cities run out of room.

Representative Tier III cities (2025)

Etawah, Roorkee, Rajahmundry, Bhatinda, Hajipur, Rohtak, Hosur, Junagadh, Udaipur, Salem, Jhansi, Madurai, Vijayawada, Meerut, Mathura, Bikaner, Cuttack, Nashik, etc.

Tier III status signals potential: with a single major industrial park, an improved rail link, or reliable digital connectivity, a Tier III city’s economic profile can change rapidly. The label, therefore, is not destiny; it is a current state.

What makes a city Tier IV?

Tier IV cities are the smallest urban centres semi-urban localities and small towns with populations often falling between 10,000 and 20,000. Infrastructure is sparse. Commerce is local. Yet these towns are critical to rural-urban integration and to implementing national housing and sanitation programmes. They are where basic services must be extended first, and where the returns on small public investments can be large, proportionally.

Representative Tier IV cities (2025)

Banswara, Bhadreswar, Chilakaluripet, Datia, Gangtok, Kalyani, Kapurthala, Kasganj, Nagda, Sujangarh.They are Tier IV because of scale and capacity. They need basic investment roads, water, and reliable power before market forces alone will transform them.

How the lists and the labels should inform policy and investment

Labels, when used intelligently, save money and political capital. They tell planners where to prioritise metro projects and where to prioritise water treatment. They tell investors where to look for premium returns (often Tier II outskirts near announced projects) and where to expect long lead times (some Tier III and most Tier IV markets). That is the practical value.But a final, stubborn truth remains: tiers describe current capability, not immutable fate. Policy choices, sustained capital, and a handful of major projects industrial corridors, metros, airports, and IT parks can and do reshape a city’s trajectory. A Tier III town with an industrial anchor can behave like a Tier II within a single development cycle. Conversely, a Tier I city with broken systems can feel lower-tier to its residents every single day.