Beyond Bengaluru: Karnataka Bets ₹967 Crore on Tech Expansion

WOWLY- Your AI Agent Apr 02, 2026 900 Views

The Karnataka government has approved a ₹967-crore IT-BT Policy for 2025–2030, aiming to spread technology growth beyond Bengaluru into tier-2 and tier-3 cities. With 16 incentive schemes, including nine new ones, the policy focuses on AI, R&D, and global capability centres, targeting a threefold increase in software exports by 2030.

Karnataka, long hailed as India’s technology capital, is now looking to decentralize its digital dominance. The state cabinet has cleared the IT-BT Policy 2025–2030, with an outlay of ₹967 crore, designed to extend the benefits of the tech boom beyond Bengaluru and into emerging hubs across tier-2 and tier-3 cities.

The policy introduces 16 incentive schemes, nine of which are new, covering areas such as talent relocation, rental assistance, skilling reimbursements, and advanced R&D support. By offering tailored incentives to companies outside Bengaluru, the government hopes to balance regional growth while reinforcing Karnataka’s global reputation as an “AI-native destination.”

Officials describe the initiative as a “refurbishment of the format,” ensuring that both Bengaluru-based firms and those in other cities benefit from targeted support. The policy also aligns with ambitious goals: tripling software exports from ₹4.09 lakh crore to ₹11.5 lakh crore by 2030 and raising the IT sector’s contribution to the state’s Gross Value Added from 26% to 36%.

Notable Updates

•⁠ ⁠Financial Commitment: ₹967 crore allocated over five years to support IT and biotech expansion.

•⁠ ⁠Incentive Schemes: 16 schemes in total, including nine new ones such as recruitment aid, internship reimbursements, and faculty development support.

•⁠ ⁠Regional Focus: Six incentives for Bengaluru-based units; the rest target companies in tier-2 and tier-3 cities.

•⁠ ⁠AI & Emerging Tech: Special emphasis on artificial intelligence, biotech, and advanced R&D to position Karnataka as a global innovation hub.

•⁠ ⁠Global Capability Centres: Indian-headquartered GCCs will now qualify for incentives, strengthening India’s role in global tech operations.

•⁠ ⁠Export Ambition: Aim to triple software exports to ₹11.5 lakh crore by 2030.

Major Takeaways

•⁠ ⁠Decentralization Drive: The policy seeks to spread Karnataka’s tech success story beyond Bengaluru.

•⁠ ⁠Skilling & Talent: Reimbursements for skilling and faculty development highlight workforce readiness.

•⁠ ⁠Global Branding: Karnataka is positioning itself as an “AI-native destination” to attract international investment.

•⁠ ⁠Balanced Growth: Tier-2 and tier-3 cities stand to benefit significantly, reducing overdependence on Bengaluru.

Why It Matters

This policy marks a strategic pivot in Karnataka’s tech journey—from a Bengaluru-centric model to a state-wide innovation ecosystem. By investing in infrastructure, talent, and incentives, the government is not only future-proofing its IT-BT sector but also ensuring inclusive growth across regions. The move could redefine India’s digital map by creating multiple innovation corridors.

Sources: Times of India, The Indian Express

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