Following a meeting with Chief Minister Siddaramaiah and Deputy Chief Minister DK Shivakumar, the Karnataka State Contractors Association has decided to withhold escalating the issue of unpaid dues to the Congress high command. The association had previously threatened to take the matter to senior Congress leaders, including Rahul Gandhi and Mallikarjun Kharge, if their concerns were not addressed.
R Manjunath, President of the Karnataka State Contractors Association, stated that the state government assured him that 50 percent of the pending dues would be cleared starting in April. Additionally, the government promised to resolve concerns related to GST and the Mining Development Plan (MDP).
Earlier, the association had written to Chief Minister Siddaramaiah, highlighting that unpaid dues of Rs 32,000 crore were causing severe financial distress for contractors. They also flagged an 8 percent GST discrepancy on projects from 2017-2020, citing a High Court ruling that held the state responsible for the additional tax burden. Furthermore, the association accused the Mining and Geology Department of unfairly imposing penalties on old contractor bills due to missing MDPs and raised allegations of increasing commission demands and corruption under the current administration.
In response to these concerns, Siddaramaiah assured that while the government was not refusing payments, funds would be released based on financial feasibility. “I informed them that we will release the funds in April. They demanded Rs 30,000 crore or Rs 15,000 crore, which is not possible. Anybody can meet anybody; we have no issues with that. However, we have to assess our financial situation before releasing the funds,” he said.
The chief minister also questioned the responsibility for the pending payments, stating that projects had been undertaken without securing adequate financial backing. “Who is responsible for the pending payments? Even when funds were available, contractors were called and assigned work. They started projects without ensuring financial backing. Whose mistake is that?” he asked.
Following reassurances from the government, Manjunath expressed satisfaction with the outcome. “They have said that starting from April, 50% of the pending amount will be cleared. Some irrelevant GST problems existed before, but they are now ready to pay 4-12 percent of the amount. We are happy with the government,” he said.
He further added that clear instructions had been given to officials to prevent such issues from recurring. While corruption among officials remained a concern, he noted that authorities had provided assurances in their presence. “We won’t write a letter to Mallikarjun Kharge now, but if there is a problem, we will definitely write to him. If we don’t get the funds in April, we will escalate the matter,” he said.
The resolution of these issues marks a significant step towards addressing the financial challenges faced by contractors in Karnataka, ensuring smoother operations and fostering a more transparent and accountable system.
