Karnataka Unveils Rs 445 Crore IT Policy to Boost Tech Hubs

Karnataka has announced a ₹445 crore IT Policy for 2025–2030 aimed at redistributing technology growth beyond Bengaluru. The policy introduces direct hiring incentives, relocation support and capital reimbursements for IT and ITeS parks in Tier II and Tier III cities.

The initiative seeks to ease pressure on Bengaluru’s infrastructure while creating new technology clusters across the state. It also includes measures to attract returning professionals and boost R&D investments in deep-tech sectors.

Incentives for Local Hiring and Talent Relocation

The state will offer ₹50,000 per local hire, capped at ₹10 lakh per unit, to encourage recruitment in emerging cities. Companies relocating talent from Bengaluru will receive 50% reimbursement of relocation expenses for up to 50 employees per unit. These incentives aim to reduce onboarding costs and strengthen talent pools in districts such as Mysuru, Mangaluru, Hubballi-Dharwad, Kalaburagi, Belagavi, Shivamogga and Davanagere.

Capital Support for IT and ITeS Parks

Developers setting up IT or ITeS parks outside Bengaluru will be eligible for 25% reimbursement of eligible capital expenditure, capped at ₹10 crore. Bengaluru-based parks will receive 20% reimbursement, capped at ₹7.5 crore. The government has limited this incentive to 10 parks to ensure targeted support for early anchor infrastructure in new tech clusters.

Financial Outlay and R&D Push

The ₹445 crore policy includes ₹345 crore for fiscal incentives and ₹100 crore for interventions. Of this, ₹125 crore is allocated for R&D programmes, allowing companies to claim reimbursements on qualified R&D activities up to ₹50 crore. This marks a significant increase from the previous ₹1 crore cap under the 2020–25 policy.

Strategic Goals and Talent Return Programme

Karnataka plans to launch an IT talent return programme to attract professionals returning from overseas, supported by a digital portal matching mid-career engineers with local firms. The policy also focuses on deep-tech areas such as AI, Blockchain, Quantum Computing and advanced Cybersecurity. The state aims to raise IT’s contribution to Gross State Value Added from 26% to 36% over the next five years.

Read More: India's Data Centre and AI Boom to Propel IT Spending.

Conclusion

Karnataka’s IT Policy 2025–2030 combines hiring subsidies, relocation support and infrastructure incentives to drive technology investments beyond Bengaluru. By fostering deep-tech innovation and creating new talent pipelines, the state seeks to position itself as a leading hub for advanced technologies.

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