BENGALURU: Allegations of irregularities have surfaced in the tendering process for KSWAN 3.0 -- Karnataka State Wide Area Network project, with claims that the state government may incur an additional financial burden exceeding Rs 90 crore because of procedural violations.
The state’s e-Governance Department is accused of bypassing established tender norms while awarding the contract for upgrading the existing statewide network infrastructure. KSWAN 3.0 aims to enhance and expand the digital connectivity linking all government offices across Karnataka, building on an already operational network.
Preparations for the project reportedly started in 2022, with consultancy firm PricewaterhouseCoopers appointed to draft tender documents after consultations with global industry players. The initial tender, Tender No. CEG/2025-26/IND0043 -- issued on July 11, 2025, saw the participation of RailTel Corporation of India, Orange Business and Telecommunications Consultants India Ltd. But the tender was cancelled on the grounds that bidders had not submitted adequate documentation. Critics argue that instead of seeking clarifications — as is standard practice — the process was abruptly scrapped.
Subsequently, citing outdated technical specifications, the department revised the criteria through a committee and reissued the tender on December 8, 2025. Concerns have been raised that this move violated provisions of the Karnataka Transparency in Public Procurement Act, which mandates a fresh tendering process only when significant changes are made. Instead, the tender was reissued as a “second call,” a step critics allege was designed to favour a specific bidder.
The revised tender reportedly included specifications that effectively limited participation to vendors supplying equipment from a single manufacturer, raising concerns about monopolistic favouritism. In the second round, only RailTel and TCIL participated.
The issue was flagged by the Karnataka Rashtra Samithi Party, which wrote to the e-Governance Department on March 25, 2026, demanding cancellation of the tender and clarification on alleged violations. But the department went ahead and issued a Letter of Intent to RailTel on March 27 after approval.
The party raised multiple questions on handling of the project, including the rationale behind cancelling the original tender, accountability for alleged lapses and the role of the consultant. It also questioned whether any penalties were imposed on the consulting firm for deficiencies in the tender design.
Technical concerns have also been highlighted, particularly regarding revised specifications that allegedly reduce the capacity of source routers while increasing that of terminal routers — an imbalance that experts warn could worsen existing server performance issues.
Calling the project “deeply flawed”, the party demanded immediate cancellation of the tender, warning that the current structure could lead to higher long-term costs for the state and promote vendor monopoly. The state government has not yet responded to these allegations.