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Big boost to electronics sector in Karnataka

The Times of India:  February 03, 2014

Bengaluru: The Union government on Thursday gave its in-principle approval for setting up of the first ESDM ( electronic system design and manufacturing) cluster development in Electronics City, Bangalore.

ESDM is the fastest growing segment of the ICT (information and communications technology) sector and is projected to be a $400 billion industry by the end of this decade. The state government, which has come out with its own Karnataka ESDM (K-ESDM ) policy, aims to capture 10% of the ESDM market in India over the next six years.

The ESDM project in Bangalore will come up on a 1.16-acre land at an investment of approximately Rs 85 crore. The state government's vision is to capture 20% of the country's total ESDM exports of $80 billion by 2020, generate 2.4 lakh new jobs, and file 5,000 patents in the same period. India is currently a big importer of electronics, and the Centre has been working towards developing a strong domestic design and manufacturing base.

"The objective of the K-ESDM policy is to make Karnataka the preferred investment destination for sectors like telecommunications, defence, automotive, and consumer products among others," said S R Patil, the state's IT & biotech minister. For companies to avail of the benefits under the policy, they would have to be registered as K-ESDM companies. So far eight companies have been registered , including Tejas Networks, Saankhya Labs, Signalchip Innovations, Cerium Systems , Bydesign, Sparr Electronics and Aristos Electronics. The state government has also finalized a list of nine engineering colleges in tier 2 and 3 cities that would house incubation centers to promote entrepreneurship.

The colleges include National Institute of Engineering, Mysore, and Siddaganga Institute of Technology, Tumkur. "The focus will be more on building an ecosystem fostering entrepreneurship rather than building physical space and purchasing expensive equipment," said Patil. He added that all incubation centres would be networked to allow students to exchange ideas and experiences.

Revision to the Karnataka Industrial Employment (Standing Orders) Rules, 1946: The state cabinet has approved the exemption of IT, ITeS, KPO, animation, gaming and other knowledge based sectors including startups from the applicability of the above labour law for a period of five years. However, clauses for the protection of women employees and prevention of sexual harassment at the work place will be integral parts of company policy.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.