This is, in fact, the path to true rural development. The only way it works is to keep the cities miserable to live in, while creating new services in the rural areas. Certain government institutions should also be relocated to rural areas. For example, why have a National Park office in Waigani? It should be in one of the PNG national parks like Varirata.
Of course the initial problem will be holdups and robberies of rural infrastructure. You just have to bear with it until the social disruption caused by putting up this new infrastructure in the rural areas equalizes again and things settle down.
As you say, the programme was rejected outright.
The reason is that urban people were rejecting something that they saw wasn't going to benefit them.
We're unlikely at this state to find either a parliament or bureaucrats, all comfortable in their urban lifestyle, to promote a shifting of infrastructure and wealth to rural areas.
In other words, those in power will never, ever agree to such things.
Thus, it looks like the only alternative is revolution?