Karnataka Rolls Out New IT Policy with ₹50,000 Incentive
The Karnataka government has unveiled its ambitious new Information Technology (IT) policy, strategically designed to propel the state’s tech ecosystem beyond the saturation point of Bengaluru.
A cornerstone of the policy is a powerful financial incentive aimed at encouraging tech firms to establish operations and relocate highly skilled talent to emerging clusters across the state.
Under the new policy, companies establishing operations in cities classified under the Emerging Technology Clusters (ETCs)—such as Mysuru, Mangaluru, Hubballi-Dharwad, and Belagavi—will be offered a cash incentive of ₹50,000 per employee.
This perk is specifically applicable to firms shifting existing employees or hiring new talent to work in these non-metro locations of Karnataka.
The move signals a concerted effort to distribute economic growth and high-value jobs across the state.
Decoupling Tech from the Capital of Karnataka
The primary goal of the new IT policy, which will guide the sector’s growth over the next five years, is to address the severe strain placed on Bengaluru’s infrastructure by its runaway tech success.
By actively promoting ETCs, the government aims to decouple the state’s tech economy from its capital, creating sustainable, high-quality job opportunities in Tier II and Tier III cities.
The policy framework promises various benefits in these emerging zones.
These benefits include subsidized land and infrastructure support, preferential tax treatments, and expedited single-window clearances.
This integrated approach seeks to lower operating costs for companies. Simultaneously, it aims to improve the quality of life for employees outside the congested capital.
Boosting Rural and Local Talent
The incentives are designed to foster growth in local talent markets.
The ₹50,000 incentive not only covers relocation costs for existing staff. It also encourages firms to tap into the substantial talent pool graduating from educational institutions in these non-metro regions.
This focus on rural and regional talent aligns with the government’s broader vision of inclusive economic development.
The policy forecasts a potential massive surge in investment and job creation in these clusters, leveraging Karnataka’s robust educational base.
By subsidizing the initial cost of expansion, the government is betting that the ETCs will become self-sustainin
g magnets for tech investment. The lower operating costs and available local talent ensure this sustainability once the firms are established.
The government intends the strategic move to secure Karnataka’s position as the nation’s premier tech hub.
At the same time, it aims to mitigate the infrastructural and environmental pressures on Bengaluru.
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