Archive · 30 Sep 2026
Karnataka contractors threaten agitation over Rs 38,000 crore dues
Government contractors in Karnataka say they have not been paid for completed work.
They estimate that eight government departments owe them about Rs 38,000 crore.
They say the actual amount could be even higher.
The contractors also allege that officials now demand larger commissions to release payments, but they have not stated the exact percentage.
They are asking the government to pay the outstanding bills and discuss their concerns.
If this does not happen, they plan protests in all 31 districts.
Deputy Chief Minister D K Shivakumar said many unpaid bills came from contracts approved during an earlier government without enough budget.
He said the government would look for a solution and asked the contractors to provide evidence of their commission allegations.
The contractors say they may reveal more details publicly in December.
The Karnataka State Contractors Association says government departments owe contractors at least Rs 38,000 crore.
The association claims dues may be several thousand crore rupees higher, while the chief minister has cited figures of Rs 40,000 crore and about Rs 50,000 crore.
Contractors allege that commission demands for clearing payments are higher than under the previous BJP government.
The association has threatened district-level protests and padayatras if its demands are not addressed before the next legislative session.
D K Shivakumar blamed contracts approved during B S Yediyurappa’s tenure without budgetary provision and said he would consider ways to resolve the issue.
- Who
- The Karnataka State Contractors Association, led by president R Manjunath, and the Karnataka government, including Chief Minister D K Shivakumar.
- What
- Contractors have threatened protests over alleged outstanding government payments estimated at Rs 38,000 crore and have raised allegations about commission demands.
- When
- The warning was issued on September 30; the association said it could begin action if payments and discussions do not occur in October or November, with further disclosures possible in December.
- Where
- Karnataka, including planned protests at Deputy Commissioners’ offices in all 31 districts; the statements were made in Bengaluru and Chamarajanagar.
- Why
- The association says contractors have not received payment for completed work and that repeated requests to ministers and officials have not resolved the issue.
Contractors’ position
Government’s position
Amount owed
Contractors’ position
The association says eight departments owe contractors Rs 38,000 crore, possibly several thousand crore more, and notes that the chief minister has cited even higher figures.
Government’s position
D K Shivakumar referred to unpaid bills from contracts approved during the previous BJP government and said the Finance Department had warned about the situation.
Commission allegations
Contractors’ position
The association says the commission demanded to clear dues is higher than under the previous government, although it has not stated the exact percentage.
Government’s position
Shivakumar asked the association to file an affidavit identifying who allegedly receives the commissions and said he would have the matter investigated.
Use of government funds
Contractors’ position
The association alleges that money owed to contractors is being used for government guarantee schemes and says its payments should be made separately.
Government’s position
The government has not accepted that claim in the report; Shivakumar said he would consider how to resolve the broader payment problem while protecting contractors.
- Reported dues
- The Karnataka State Contractors Association estimates outstanding payments at Rs 38,000 crore or more.
- Departments involved
- The association says eight government departments owe payments.
- Major department figures
- The association cites Rs 8,000 crore from the Public Works Department, Rs 14,000 crore from major irrigation, and Rs 3,600 crore from minor irrigation.
- Planned action
- The association plans district-level padayatras and memorandums to Deputy Commissioners’ offices across Karnataka.
- Commission allegation
- The association alleges that commission demands are higher than during the previous BJP government but has not disclosed a percentage.
- Government response
- D K Shivakumar attributed the payment problem to contracts approved during B S Yediyurappa’s tenure without budget provision and said he would consider solutions.
- Earlier political allegation
- The Karnataka State Contractors Association’s earlier 40 per cent commission allegation became a major Congress campaign issue before the 2023 Assembly polls.