Last updated on May, 9 2021
KARNATAKA State Report | December, 2020
Karnataka is located in the south 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 is estimated to reach 18.06 trillion (US$ 256.17 billion) in 2020 21BE. The GSDP (in Rs.) of the state will increase at a CAGR of 11.56% between 2015 16 and 2020 21. The state’s per capita GSDP was Rs. 253,444 (US$ 3,595) in 2019 20. The per capita GSDP (in Rs.) increased at a CAGR of 11.70% between 2011 12 and 2019 20.
Karnataka has vibrant automobile, agro, aerospace, textile and garment, biotech, and heavy engineering industries. The state has sector specific Special Economic Zone (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. It has 23 operational IT/ ITeS SEZs, five software technology parks and dedicated IT investment regions. Karnataka boasts of a diverse flora and fauna and a 320 km natural coastline, which makes it a nature tourist's paradise.
The state attracted Foreign Direct Investment (FDI) equity inflow worth US$ 7,948.53 million between October 2019 and September 2020 according to the data released by Department for Promotion of Industry and Internal Trade (DPIIT).
Merchandise export from Karnataka reached US$ 17.36 billion in 2018-19 and US$ 16.64 billion in 2019-20.
Karnataka offers a Wide range of fiscal and policy incentives for businesses under the Karnataka Industrial Policy, 2020-25 with simplified procedures for investment. Through the ESDM Policy 2013, the Government of Karnataka 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’. Electric Vehicles manufacturing in Karnataka is expected to attract investment worth US$ 4.82 billion and create 55,000 jobs.
Karnataka is the first state which came out with an aerospace policy in the country. Karnataka Aerospace Policy has identified an investment potential of US$ 12.5 billion in this sector during 2013-23 and plans to develop aerospace clusters in different regions of the state. Karnataka government has granted approval for investment of Rs. 480 crore (US$ 68.67 million) to Goodrich Aerospace Service Pvt Ltd to establish a unit in Bengaluru.