Karnataka Offers 10% Incentive to Boost R&D Manufacturing

With over 400 Fortune 500 companies having R&D centers in Bengaluru but only 10% manufacturing locally, the revised policy offers flexible incentives, including production-linked and capital-based benefits. Employment-based incentives will also favor firms hiring women.

The state has allocated Rs 50 billion to improve industrial infrastructure, including better water supply and leased land options. Companies can also invest up to 26% in solar or wind energy projects, supporting Karnataka’s 65% renewable power capacity.

Additionally, Karnataka is launching an AI-driven single-window portal with Microsoft to halve application processing time. Beyond Bengaluru, Belgaum is being developed as an electronics and aerospace hub, Bijapur for semiconductor-related industries, and Mysore, Hubli, and Belgaum as IT and startup centers.

These initiatives come ahead of Invest Karnataka 2025 on February 12, where the state targets Rs 10 trillion in investments with a 70% conversion rate. Karnataka has already secured Rs 100 billion from Japan and South Korea in high-tech sectors like semiconductors and battery manufacturing.