Bengaluru’s Growth Has Outrun Its Governance. The GBG Act Is a Turning Point, If the City Uses It Well

Bengaluru became India’s technology capital through private risk-taking, global integration, and an unusual concentration of talent. Today, the city employs more than 2.5 million technology professionals, hosts around 490 Global Capability Centres, and contributes roughly USD 130 billion in annual services exports. Few cities outside the United States and China command this level of economic concentration. What Bengaluru did not build alongside this growth was a governance system capable of managing a city of its scale and complexity.

That mismatch is now visible across daily life. The city routinely ranks among the most congested cities globally, operates under a master plan prepared nearly two decades ago, and has been without an elected municipal council since 2020, despite constitutional guarantees of five-year terms. Infrastructure projects regularly overshoot timelines by years. Core civic agencies function in silos, governed by separate laws, reporting vertically to the state, and insulated from local accountability. Bengaluru anchors national economic performance while struggling with basic coordination of civic services.

This paradox has reached its limit. Flooding, congestion, fragmented service delivery, and stalled infrastructure are structural realities of a city whose economic footprint has outgrown its institutional design. Against this backdrop, the Greater Bengaluru Governance Act, 2025, represents the most significant attempt in decades to reset how the city is governed. Whether it becomes a genuine inflection point depends on how its design choices are interpreted and implemented.

A new white paper by 3one4 Capital, Bengaluru’s Strategic Growth Imperative, approaches this moment through those who have lived Bengaluru’s governance reality up close. The analysis is anchored in conversations with legal scholars, former committee members, civic organisers, political actors, and urban practitioners who have shaped, challenged, or operated within the city’s institutional architecture. Their collective insight offers a clear message. Structure matters, but power, accountability, and capacity matter more.

Few people understand Bengaluru’s governance fault lines better than those who helped design the proposed reforms. V. Ravichandar, a member of the Brand Bengaluru Committee, describes the original intent behind restructuring as an effort to scale governance to match lived reality. Bengaluru is today served by more than a dozen parastatal agencies responsible for water, transport, electricity, land use, and mobility, each operating under separate statutes. The committee’s proposal for a three-tier system, with empowered wards, multiple municipal corporations, and a thin metropolitan authority, was shaped by the recognition that coordination had failed not due to the absence of plans, but due to the absence of authority.

Legal experts echo this concern from a constitutional perspective. Alok Prasanna Kumar of the Vidhi Centre for Legal Policy points out that India’s 74th Constitutional Amendment created permissive conditions for urban decentralisation without mandating it. In practice, this has allowed repeated supersession of municipal bodies. Bengaluru has operated without an elected council for over four years, even as agencies responsible for water supply, land development, power distribution, and transport continue to operate without electoral oversight.

This institutional fragmentation has real consequences. Sneha Priya Yanappa, who has studied Bengaluru’s urban governance for years, describes a system in which accountability is continually deferred. Agencies blame one another, plans overlap or contradict, and no single authority can be held responsible for outcomes. The city’s Revised Master Plan 2031 was withdrawn following contradictions among agencies, leaving Bengaluru governed by the outdated RMP 2015, prepared in 2006–07, despite the city having nearly doubled in built-up area since then.

Infrastructure planning reflects the same pattern. Feasibility reports proposing over 200 kilometres of elevated corridors, including tunnels and flyovers with capital outlays exceeding ten times BBMP’s annual budget, were prepared without public hearings or council debate. Even after public withdrawal of such proposals, bids for detailed project reports were reissued within weeks. The issue is not ambition but governance processes that are detached from accountability.

The Greater Bengaluru Governance Act seeks to address this by formally recognising Bengaluru as a metropolitan entity. It restructures the city into multiple corporations and creates the Greater Bengaluru Authority to coordinate planning and development across jurisdictions. That shift alone marks a break from legacy frameworks such as the Karnataka Municipal Corporations Act, which was never designed for a megacity employing millions and driving national exports.

Yet many of those closest to the process caution that intent and execution are diverging. The Brand Bengaluru Committee originally envisioned the metropolitan authority as non-executive, designed to harmonise rather than command. In its current form, the GBA exercises executive powers and performs coordination functions. Several interviewees warn that this risks reproducing state-level centralisation rather than empowering city-level governance.

Political practitioners see the tension clearly. T.V. Mohandas Pai notes that Bengaluru’s economic success masks a governance system where no single authority is accountable for outcomes at the neighbourhood level. Twelve agencies may operate in the same area, but residents have no clear line of responsibility when services fail. Coordination mechanisms such as the Metropolitan Planning Committee and the Bengaluru Metropolitan Land Transport Authority remain either unconstituted or non-functional, despite existing legal mandates.

Civic leaders add another layer to the diagnosis. Srikanth Viswanathan of Janaagraha emphasises that governance reform must ultimately strengthen citizen-facing institutions. Ward Committees were intended to be foundational units of governance, with powers to sanction works and oversee budgets. Under the Act, key provisions such as proportional representation and fiscal devolution to wards have been diluted. Without financial authority or executive backing, local participation risks remaining symbolic.

Fiscal capacity is central to this debate. Bengaluru’s municipal revenues remain modest relative to its economic scale, with heavy dependence on state transfers. Interviewees across the spectrum agree that without predictable fiscal devolution, cities cannot plan long-term infrastructure or respond to shocks. Economic engines cannot run on discretionary funding.

What distinguishes this moment is that the conversation has moved beyond critique. Even sceptics of the Act recognise that it creates a platform on which reform can be built. The legal reset away from outdated municipal frameworks matters. The formal recognition of metropolitan scale matters. The creation of institutional space, however imperfect, is necessary for coordination.

The question is how the next phase unfolds. Several interviewees emphasise that Bengaluru’s governance challenges cannot be addressed by adding new layers alone. Executive accountability at the municipal level, real authority for ward institutions, and a metropolitan body that coordinates rather than commands are essential if decentralisation is to work in practice.

Beyond civic matters, Bengaluru’s role in India’s economy is structural. The city anchors a large share of India’s technology exports, hosts a dense concentration of multinational R&D and operations centres, and remains central to the country’s startup ecosystem. Persistent governance failure now threatens talent retention, investment confidence, and long-term competitiveness.

The white paper’s most important contribution lies in reframing the debate. It treats the GBG Act as an opening rather than an endpoint. Reform, it argues, is iterative. Institutions evolve through use, contestation, and adjustment. The danger lies in mistaking legislative passage for institutional completion.

Bengaluru has reached a moment where governance choices will shape its trajectory for decades. Cities that succeed at scale align authority with responsibility and participation with power. Cities that fail to scale governance risk paralysis.

The GBG Act has placed Bengaluru at that fork in the road. What follows will determine whether the city builds governance systems worthy of its economic role, or whether it continues to rely on improvisation where institutions should stand. 

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_{The views expressed herein are those of the author as of the publication date and are subject to change without notice. Neither the author nor any of the entities under the 3one4 Capital Group have any obligation to update the content. This publications are for informational and educational purposes only and should not be construed as providing any advisory service (including financial, regulatory, or legal). It does not constitute an offer to sell or a solicitation to buy any securities or related financial instruments in any jurisdiction. Readers should perform their own due diligence and consult with relevant advisors before taking any decisions. Any reliance on the information herein is at the reader's own risk, and 3one4 Capital Group assumes no liability for any such reliance.Certain information is based on third-party sources believed to be reliable, but neither the author nor 3one4 Capital Group guarantees its accuracy, recency or completeness. There has been no independent verification of such information or the assumptions on which such information is based, unless expressly mentioned otherwise. References to specific companies, securities, or investment strategies are not endorsements. Unauthorized reproduction, distribution, or use of this document, in whole or in part, is prohibited without prior written consent from the author and/or the 3one4 Capital Group.}