Karnataka authorities releases 125 crore to newly-formed firms in Bengaluru

The Karnataka authorities accepted an preliminary grant of ₹125 crore for the 5 new metropolis firms created by dividing the Bruhat Bengaluru Mahanagara Palike (BBMP). Each company beneath the Greater Bengaluru Authority (GBA) will obtain ₹25 crore to handle common administrative and operational bills till a system is put in place for direct tax funds into their very own accounts. 

The new firms have been established beneath the Greater Bengaluru Administration Act, 2024 via a authorities notification issued on September 2, 2025. They are Central Corporation, East Corporation, West Corporation, North Corporation and South Corporation. With this restructuring, BBMP has ceased to exist. All its belongings, liabilities, officers and workers have been transferred to the GBA, which can now oversee the 5 firms, together with Bengaluru Solid Waste Management Limited (BSWML) and Bengaluru Smart Infrastructure Limited (B-SMILE). 

Interim measure

For the monetary yr 2025-26, BBMP’s property tax assortment of about ₹300 crore has been saved within the account of Union Bank. From this reserve, ₹25 crore every is being launched to the 5 firms as an interim measure. The firms have already opened their particular person financial institution accounts, however till tax revenues begin flowing instantly, the federal government of Karnataka will launch funds from the BBMP’s account.

In future, when the remaining BBMP grants are distributed among the many firms, the federal government might regulate this advance quantity, the order acknowledged.  

The authorities has made it clear that the grant have to be spent solely as per guidelines and with the approval of the respective administrative officers. It additionally acknowledged that these grants can be adjusted throughout future distribution of BBMP funds, and that expenditure ought to adjust to the Karnataka Economic Code, 1958 and all different present monetary legal guidelines. 

The order was handed beneath numerous sections of the Greater Bengaluru Administration Act, 2024. These sections enable the federal government to take over all belongings and liabilities of BBMP and different native authorities when the ultimate notification is issued. It additionally permits the federal government to quickly handle these belongings and make monetary preparations till the brand new firms are totally useful.