CAG Report No. 11 of 2025 — Implementation of Smart City Mission, Government of Karnataka

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Executive Summary
Smart Cities Mission was launched by Government of India on 25 June 2015
in order to meet the changing needs of the cities and achieve comprehensive
development of physical, institutional, social and economic infrastructure
of the cities. As per Census 2011, cities house 63
per cent of the
population. The mission was to cover 100 cities and its duration was five
years (2015- 16 to 2019- 20) which has been extended up to March 2025.
The Mission has two components, viz., Area Based Development (ABD)
and Pan City development. Seven cities in Karnataka have been selected,
viz., Belagavi, Bengaluru, Davanagere, Hubballi-Dharwad, Mangaluru,
Shivamogga and Tumakuru under the Mission.
The Performance Audit on the ‘Implementation of Smart Cities Mission’
was undertaken to assess whether, the implementation of the scheme was in
convergence with other related Government schemes, funds released by
State Government to Cities/ Special Purpose Vehicle (SPV) and
mobilization of funds by Cities/SPVs was efficient and in consideration with
objectives of the scheme, the projects were implemented in accordance with
Smart City proposals and SCM guidelines; there exists mechanism for
monitoring the implementation of the Smart Cities Mission and whether
there exists adequate representation of Urban Local Bodies (ULBs) in SPVs.
The Performance Audit was conducted (May 2022 to December 2022, July
2023 to September 2023 and May 2024 to July 2024) to review the
implementation of the Mission during the period 2015-16 to June 2024.
Major Audit Observations
Planning
Selection of cities through smart city challenge process and preparation of
Smart City Proposals by the selected cities were the introductory milestones
in the implementation of the Mission. As against 135 goals specified in the
SCP of smart cities aligned to nine strategic pillars, the achievement was 68
only and other projects are in progress. Smart cities dropped 160 out of 544
(30 per cent) projects originally planned, which was against MoHUA
instructions. The State Government stated that interventions from multiple
departments were required in implementation of the scheme and it will be
impractical to expect achievement of all these long-term goals under a single
mission.
As against ₹817.42 crore allocation under Pan City, projects were taken up
for ₹1,462.67 crore. The Tender SURE guidelines aimed at solving issues
of non-usability of road network due to frequent civil works undertaken by
multiple utility agencies to provide underground utilities viz., water supply,
telecom lines, power lines, sewage etc., which were haphazardly laid. Non-
provision of utility ducts in SPVs other than BenSCL necessitated frequent
digging up of the carriageway of the road for laying of utility lines.