Karnataka is one of the fastest growing states in India. The natural resources, policy incentives and infrastructure in the state favour investments in the IT/ITeS, biotechnology, engineering, electronics, automotive, textiles, agri and food-processing sectors.
Karnataka's favourable policies have encouraged industries to set up their research and development (R&D) centres in the state. The state has about 401 R&D centres, the most in India. Around 400 of the Fortune Global 500 companies outsource their IT services to firms in Bengaluru.
The state contributed 7.54 per cent to the Gross State Domestic Product (GSDP) of India in 2015-16. Between 2004-05 and 2015-16, the GSDP of the state grew at a Compound annual growth rate (CAGR) of 13.93 per cent to US$ 156.23 billion and the net state domestic product (NSDP) grew at a CAGR of 14.19 per cent to US$ 142.9 billion.
Karnataka is the IT hub of India and home to the fourth largest technology cluster in the world. Karnataka has 47 IT/ITeS SEZs, three software technology parks and dedicated IT investment regions. The exports of IT and electronic products from the state reached US$ 10.38 billion by the end of December 2015. Exports of IT and electronic products accounted for 38 per cent share in India's IT and electronic products exports and 52.89 per cent share in Karnataka’s overall exports as of December 2015.
Karnataka is making significant investments in industrial infrastructure, such as setting up industrial clusters and SEZs and public-private partnership (PPP) projects to provide an impetus to further industrial development.
The following are some of the major initiatives taken by the state government to promote Karnataka as an investment destination: