Bhuria had represented the Ratlam-Jhabua constituency in the Lok Sabha. He passed away last June.
"Bringing smile to the face of each and every tribal person will be the real tribute to Bhuria who worked relentlessly for their welfare," Chauhan said.
The statue stands at Dileep Gate Premises, where a park would be developed at a cost of Rs one crore, Urban Administration Minister Lal Singh Arya said on the occasion.