The Karnataka government has launched the Industrial Policy 2025-30, aiming to transform the state into a premier hub for high-tech manufacturing and economic growth. The policy, unveiled by Deputy Chief Minister D.K. Shivakumar at the Global Investors’ Meet ‘Invest Karnataka 2025’ in Bengaluru, sets an ambitious target of attracting investments worth Rs 7.5 lakh crore and generating 20 lakh jobs over the next five years.

The new industrial policy focuses on equitable and sustainable development, with a strong emphasis on expanding industrial growth beyond Bengaluru. The government has introduced a zoning strategy to ensure balanced development across various districts:

• Zone-1 and Zone-2: Comprising industrially backward districts, these regions will receive special incentives to attract investments and spur economic activity.
• Zone-3: Covering Bengaluru’s Urban and Rural districts, this zone will have a distinct incentive structure to encourage industries to invest in other parts of the state.

Key Focus Areas

The policy outlines several priority sectors to drive economic expansion, including aerospace and defence, electronics, steel, cement, warehousing and logistics, textiles, future mobility, green hydrogen, industrial robotics, drones, medical technology, space technology, biotechnology, renewable energy, pharmaceuticals, automobiles, FMCG, and tourism.

Speaking about the new policy, Large and Medium Industries Minister M.B. Patil highlighted that the zoning classification ensures targeted support for industries in less developed regions, thereby preventing the overconcentration of industries in Bengaluru.

Core Pillars of the Industrial Policy

The Industrial Policy 2025-30 is structured around four key pillars:

1. Financial Incentives: Industries can opt for either capital subsidies or production-linked incentives (PLI) to boost investments.
2. Infrastructure Development: The policy promotes public-private partnerships (PPP) for infrastructure projects, including the development of ‘green industrial areas’ and affordable worker housing for ultra-mega projects.
3. Ease of Doing Business: The government aims to streamline business approvals through an improved single-window system for faster permits and clearances.
4. Human Capital Development: Efforts will be made to strengthen industry-academia collaborations and introduce updated curriculums in ITIs and polytechnics to create a skilled workforce aligned with industry needs.

Empowering MSMEs and Inclusive Growth

The policy provides significant support to micro, small, and medium enterprises (MSMEs), with 30% of land in industrial areas reserved for MSMEs and 24.1% allocated for SC/ST entrepreneurs. Key initiatives include:

• Affidavit-based approvals for faster clearances.
• Vendor development conclaves and marketing assistance.
• Support for technology upgrades and cluster development.
• MSME Manufacturing Excellence Awards to encourage innovation.

Innovation and Sustainability

The policy also promotes green initiatives by incentivising sustainable industrial practices and the creation of eco-friendly industrial zones. Research and innovation are prioritised, with the establishment of KWIN City (Knowledge, Wellbeing & Innovation City) as a hub for advanced research and healthcare.

Also Read  | Karnataka’s New Industrial Policy Aims for Job Growth and Sustainable Practices

Karnataka Chief Minister Siddaramaiah emphasised that the state continues to be a leader in electronics, IT, and emerging technologies, contributing significantly to India’s exports. He highlighted ongoing efforts to improve connectivity and infrastructure, including plans for a second international airport in Bengaluru to enhance global connectivity and economic potential.

The policy also seeks to strengthen Karnataka’s position as the ‘EV capital of India,’ with major investments from companies such as Tesla, Ola Electric, Ather Energy, and Mahindra Electric. Additionally, with over 65% of India’s aerospace and defence manufacturing occurring in the state, Karnataka aims to maintain its leadership in these sectors.

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