Industrial Development & Economic Growth in Karnataka

Karnataka is located in the southern region of India. It is surrounded by the Arabian Sea on the west, Goa on the northwest, Maharashtra on the north, Andhra Pradesh on the east, Tamil Nadu on the southeast, and Kerala on the southwest.

At current prices, the Gross State Domestic Product (GSDP) of Karnataka stood at about Rs12.69 trillion (US$ 196.88 billion) in 2017-18. The GSDP (in Rs) of the state grew at a CAGR of 13.11 per cent between 2011-12 and 2017-18. The state’s per capita GSDP was Rs 193,409 (US$ 3,001) in 2017-18. The per capita GSDP (in Rs) increased at a CAGR of 11.89 per cent between 2011-12 and 2017-18.

The cumulative FDI inflows in the state from April 2000 to December 2018 were recorded at US$ 35.69 billion, the third highest in India after Maharashtra and New Delhi and accounted for a share of 9.0 per cent in India’s cumulative FDI inflows.
Merchandise exports from Karnataka reached US$ 18.05 billion in 2017-18 and reached US$ 15.77 billion in April 2018-February 2019. 

Karnataka has vibrant automobile, agro, aerospace, textile & garment, biotech and heavy engineering industries. The state has sector-specific SEZs for key industries such as IT, biotechnology, and engineering, food processing and aerospace.

Karnataka is the IT hub of India and home to the fourth largest technology cluster in the world. In 2017- 18, total exports from the state aggregated to US$ 39.38 billion (up to November 2017). Karnataka has 47 IT/ITeS SEZs, three software technology parks and dedicated IT investment regions. As of January 2019, Karnataka had a total installed power generation capacity of 27,272.36 megawatt (MW). 

Karnataka boasts of a diverse flora and fauna and a 320 km natural coast line, which makes it a nature tourist's paradise. Tourist arrivals in the state increased from 36.7 million in 2006 to 102.3 million in 2017.

Karnataka offers a wide range of fiscal and policy incentives for businesses under the Karnataka Industrial Policy, 2014-19. Through the ESDM Policy 2013, the government of Karnataka has planned to facilitate, promote and develop the ESDM sector in Karnataka and make the state a preferred destination for investment in this sector. In September 2017, the government of Karnataka passed the ‘Karnataka Electric Vehicle and Energy Storage Policy 2017’.