The sanctioned money would be used to set up a trauma centre where there will be a modern emergency ward and a burn unit, Medical College Principal Dr Pratip Kumar Kundu said.
As NH-34 is located beside the hospital, accident cases would be handled in the six storey building of the trauma centre.
Kundu said the existing nurses' hostel would be demolished to make way for the building and the hostel would be shifted to a nearby house.
The trauma centre would be set up in three years, the principal said.
PMSSY aims at correcting the imbalances in the availability of affordable healthcare facilities in various parts of the country and augmenting facilities for quality medical education in under-served states.