The late actor, also known as 'The Showman', will be recognised by the construction of 'Raj Kapoor Crescent'.
"Several members of the Kapoor Family will be present to witness the opening of the film festival. For this reason, the city of Brampton would like to celebrate their presence while honouring the late Raj Kapoor for his contributions to Indian Cinema," a statement confirmed.
The actor's grandson Ranbir Kapoor announced last week, however, that filming commitments would prevent him from attending the event.
The Shree 420 and Awaara star will also be the subject of a retrospective of his work 'Raj Kapoor and the Golden Age of Indian Cinema'.
"The city would also like to induct Shri Raj Kapoor into the Brampton Hall of Fame, having a star placed there in his honour," the statement added.
The 12th International Indian Film Academy (IIFA) Weekend and Awards take place in the last weekend of June.
