"We are really happy as the Cabinet has decided to do so," Education Minister Nurul Islam Nahid said at a media briefing on Monday.
However, the existing JnU establishments at Old Dhaka's Chittaranjan Avenue will also remain, said Nahid.
He added that the new campus will be built at the site in Keraniganj where the government has cleared a project to build a 10-storey building as a residential hall for JnU students.
"An 8.25-acre land plot has already been acquired and there is more land which can be acquired for the new campus."
He said that the land acquisition process will begin shortly.
The decision comes amid ongoing protests by its students for residential halls.
Students of JnU, one of the oldest higher education institutions in Dhaka, have been demanding residential halls for the last seven years after it was turned into a university from college.
The government project for constructing a residential hall in Keraniganj has not picked any pace.
JnU students took to the streets last month demanding construction of residential halls at the spot where the Dhaka Central Jail was previously situated on Nazim Uddin Road in Old Dhaka.
After a meeting with the JnU vice-chancellor on Aug 24, Minister Nahid said he had received the prime minister's instruction to expedite the construction of a residential hall at Keraniganj.
The latest development on a new campus came during the weekly Cabinet meeting on Monday.
A Cabinet member told bdnews24.com that Prime Minister Sheikh Hasina said the decision to build a park and a museum at the site of old jail will remain and asked the education minister what measures have been taken to address the JnU issue.
The minister told her a hall for male students will be built while another for female students was under construction. Nahid said they were looking for land at RAJUK's housing projects, Purbachal and Jhilmil, he added.
"The prime minister then asked him why will the academic building, residential halls for females and males be built at different sites?"
The Cabinet member said Hasina instructed Nahid to acquire land at one site and make plans for a new campus.
