It's only sustainable if the government pours money into the communities to keep people living there. Whether intentional or not, many reservations are like this. Farming or mining communities, on the other hand, usually simply vanish.

In managed economies (like the Soviet Union), they could force spawn communities and populate them with whomever they were forcibly relocating there. Many of those communities still exist today (look at a map of the steppe in Kazakhstan and you'll see a map of prison colonies).

Canada tried some similar things, but I don't think they are politically palatable -- See: Resolute Bay or similar. They forced the people to move, but didn't create the primary economy required for the communities to thrive.