Karnataka to fund only 40% of Bengaluru tunnel road project

Karnataka will fund only 40% of Bengaluru tunnel road cost, with private firms covering 60% under BOT; Adani’s bids exceed govt estimates by 24–28%

Deputy Chief Minister D K Shivakumar has clarified that the Karnataka government will contribute only 40 percent of the estimated cost of the proposed Bengaluru tunnel road project, irrespective of the bid amounts quoted by private firms. The project is planned under the build, operate and transfer (BOT) model, requiring the concessionaire to bear the remaining investment.

The tunnel road, stretching 16.75 km from Silk Board Junction to Hebbal, has been estimated by the government to cost around ₹17,698 crore. However, bids submitted by the Adani Group have quoted a significantly higher figure of ₹22,267 crore. For the Hebbal–Seshadri Road package, the group quoted ₹10,867 crore against the government’s estimate of ₹8,770 crore. Similarly, for the Seshadri Road–Madiwala package, the bid stood at ₹11,400 crore compared to the official estimate of ₹8,928 crore.

Shivakumar stated that the government’s share would be capped at 40 percent of the estimated cost, which translates to about ₹1,200 crore per kilometre. Any additional expenditure beyond this benchmark would have to be managed by the private agency executing the project.

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The tender process saw participation from four infrastructure companies, though two were disqualified during the technical evaluation stage. The Adani Group emerged as the leading bidder for both packages, quoting nearly 24 percent higher for the first and 28 percent higher for the second.

Under the BOT model, the private concessionaire will raise 60 percent of the funding and will be granted toll collection rights for a period of 30 years, extendable by another decade. In addition, six acres of land will be allocated for commercial development to support the project’s financial viability.

The tunnel road project is expected to ease traffic congestion along one of Bengaluru’s busiest corridors, connecting the southern and northern parts of the city. However, the higher-than-expected bids have raised questions about cost management and the extent of government support. Shivakumar emphasized that the state’s financial commitment will remain fixed, ensuring fiscal discipline while allowing private participation to drive the project forward.

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