What is the procedure of creating new districts within a state?

Formation of a new district or reorganisation of existing districts in new districts is a matter completely under the power of state Govt and the proposal in this regard are examined by the state finance ministry before getting approved by the Chief Minister.

These proposals are prepared based on the distribution of resources and services in the concerned district. The logistic part is also taken as a deciding factor and if a village is near to the other district headquarter then it makes sense to move it to that district only. Financial vetting of these proposals is also a very important step which ensures that this change is not going to cost the state Govt any unnecessary expenditure in connection with planning and administration in these regions.

The proposals of these reorganisation or carving out of districts out of existing districts is presented in the legislative assembly also for the information of the house and to answer and explain if any query is there by any member. If there are objections by the members in the matter and house takes cognisance of the same then the revision of proposal can also be sought.

For any such change it has to be reflected in the state gazette notification for records sake.

For the formation of a new district, no central government permission is required whereas the formation of a new state is in the purview of Central government. This will be under the state government only.
The home and finance department will study the feasibility of the formation of a new district. Once they feel it is viable and advisable they may put it in the meeting of the ministers. Before it goes to the cabinet meeting, the Chief Minister will also study the proposal and the matter will come for discussion in the cabinet meeting. In this proposal they will take into account the geographical, financial and security angle will also be studied.
Then the proposal will be presented in the Assembly for discussion. Once it is passed in the Assembly, it will be sent to Governor for his formal approval.
The district formation will be published officially in the Gazette. Once it is formed separate district administration will be created for the governance.

Formation of a new district either by carving out of the old ones or reorganising the number of districts and increasing the numbers for better administration, is under the purview of state Govt.

The proposal after due diligence and duly approval by CM is to be tabled in the state legislative assembly and once it is passed there it is to notified in the gazette. Thereafter the orders for its implementation are issued to the concerned authorities. As the process has many aspects it takes time to formalise and establish the new district headquarters and other paraphernalia including new offices and facilities to manage the district level administrative and municipal activities.

Process is simple but survey and preparing a proposal is very difficult.
Once proposal is approved in State assembly both houses. It will be approved from governor. After that effective date will be communicated to new district administration. So basically local MLA and people plays main role to get ready proposal.