Of the country's major cities, Mumbai has the biggest slums -- some 6.5 million people living in cluttered shacks lined with a maze of open drains.
The city is home to Asia's largest slum, Dharavi. The sprawling settlement of grey and black shacks is one of the first sights of Mumbai when arriving by air.
New Delhi follows Mumbai, with 1.8 million people living in squalor.
The Indian economy has grown at an average of 8.6 per cent in the last four years but analysts say the growth has not touched millions of poor.
The minister said the government has launched several schemes to provide civic amenities to slum dwellers but civil rights groups say the government has not done enough.
"Slums are here to stay," said Maju Varghese of YUVA Urban, a social organisation working for more than two decades with the urban poor.
"What has happened is the total failure of the government to provide affordable housing to the urban poor. The government has completely ignored this problem," he added.
About a quarter of the country's billion-plus population lives in towns and cities.