Commercial
Karnataka’s New IT-BT Policy – How Companies Can Benefit From It
March 27, 2026
Karnataka's IT-BT Policy 2025-2030 (Information Technology and Biotechnology) offers companies up to 40% R&D expenditure reimbursement and 20% capital expenditure support for expanding beyond Bengaluru into cities like Mysuru, Mangaluru, Hubballi-Dharwad, Belagavi, Tumakuru, Shivamogga and Kalaburagi. The policy targets 90 lakh jobs and aims to grow software exports to Rs 11.5 lakh crore by 2030, with Mysuru emerging as a leading Tier-2 destination offering 30-40% lower operational costs.
Karnataka has defined India's technology landscape for decades. Even though Bengaluru is still the main hub for IT and startups, the state is now looking beyond just one city. The Karnataka IT-BT Policy 2025–2030 — IT-BT standing for Information Technology and Biotechnology, the two sectors overseen by the state's IT/BT Department — is a clear effort by the government to spread that success to other areas.
The policy's core objective is to focus on decentralisation, directing technology development beyond Bengaluru, so the entire state benefits, and not just the capital. The Karnataka IT policy for businesses is aimed at creating tangible growth opportunities, making expansion faster and more stable by moving into different parts of the state.
Companies evaluating Tier-2 cities like Mysuru will see that this policy provides concrete fiscal incentives, infrastructure support and regulatory facilitation, transforming regional expansion from an operational challenge into a strategic advantage.
What is Karnataka's IT-BT Policy?
Karnataka's IT-BT Policy is a five-year roadmap to position the state as a global leader in technology, innovation and digital leadership. The policy is designed around three key areas of focus:
- Maintaining Karnataka's technology leadership through sustained growth in IT services, startup ecosystems and emerging technology sectors, ensuring the state's continued prominence in India's digital economy.
- Decentralising technology development beyond Bengaluru through targeted investment in Tier-2 cities and emerging commercial centres, creating balanced growth across Karnataka's urban landscape.
- Advancing infrastructure, workforce capabilities and emerging technologies, including AI, cybersecurity and specialised training programmes, to create robust operational environments for business growth.
The policy fundamentally reduces barriers to establishment and expansion across Karnataka's commercial geography.
Karnataka IT-BT Policy — Key Incentives at a Glance
| Incentive | What It Covers |
|---|---|
| R&D expenditure reimbursement | 40% of eligible R&D expenditure, up to Rs 5 crore, for new or expanding units (Bengaluru and Beyond Bengaluru) |
| Capital expenditure support | 20% of eligible capital expenditure, up to Rs 5 crore, for new IT/ITeS parks set up Beyond Bengaluru |
| Policy-wide job target | 90 lakh direct and indirect jobs by 2030 |
| Software export target | Growth from Rs 4.09 lakh crore to Rs 11.5 lakh crore by 2030 |
Tip: These are the state-level incentive structures as announced; exact eligibility criteria and application processes should be confirmed with Karnataka's IT/BT Department or a policy advisor before making investment decisions.
Karnataka's IT-BT Policy Signals a Strategic Shift Beyond Bengaluru
For years, Bengaluru has carried most of Karnataka's IT growth. While this helped build scale, it also created challenges.
Why Reduce Over-Dependence on Bengaluru?
- Talent competition has intensified as companies draw from the same candidate pool, increasing acquisition and retention costs.
- Real estate and operational expenses have escalated significantly, impacting cost structures.
- Infrastructure constraints, including traffic congestion and civic capacity, now affect productivity and employee experience.
Which Cities Benefit From "Beyond Bengaluru" Development?
- Mysuru, Mangaluru, Hubballi-Dharwad, Kalaburagi, Shivamogga, Tumakuru and Belagavi are the seven cities positioned as sustainable IT hubs and long-term growth engines under the policy.
This shift supports Tier-2 city IT expansion while reducing pressure on Bengaluru.
Why This Policy Matters Now for Companies
The timing of the Karnataka government's IT policy is especially relevant for today's business environment. Distributed and hybrid team structures have become operational standards, companies face sustained pressure to optimise cost structures, and accelerated go-to-market timelines now determine competitive positioning.
How the Policy Aligns With Different Businesses
The policy supports diverse business profiles. Startups access affordable locations with streamlined establishment processes. Scaling businesses find expansion capacity without metro-level overhead. Enterprises and Global Capability Centres (GCCs) secure stable, policy-supported growth environments across multiple locations.
Why Early Movers Benefit the Most
Early adoption delivers strategic advantages: first-mover positioning in emerging markets, priority access to regional talent pools, reduced establishment friction and accelerated operational timelines. These factors make Karnataka's IT-BT policy particularly compelling for businesses evaluating expansion strategies.
Key Enablers Under Karnataka's New IT-BT Policy
Karnataka's new IT policy is designed to be practical, not just aspirational. Some of the key enablers include:
- Ease of doing business: simplified approvals, faster clearances, single-window support systems.
- Infrastructure and digital ecosystem: improved connectivity, IT parks and commercial hubs, reliable digital infrastructure.
- Talent development and workforce enablement: skilling programmes aligned with industry needs, support for regional talent ecosystems.
- Support for emerging technologies: emphasis on AI, data, cybersecurity and advanced IT services, plus support for innovation-driven businesses.
Together, these create strong regional technology hubs across Karnataka.
Mysuru's Rise as a Preferred IT & Business Destination
Mysuru has emerged as a strategic beneficiary of Karnataka's IT-BT Policy, offering distinct advantages for technology businesses. The city delivers operational cost efficiencies of 30-40% compared to metropolitan markets while providing robust multimodal connectivity and access to growing talent pools from established educational institutions.
This combination supports multiple deployment models: companies can establish new offices, deploy satellite operations complementing Bengaluru headquarters, or build long-term scalable centres. As policy-driven infrastructure development accelerates, Mysuru's positioning as a viable expansion alternative to Bengaluru continues to strengthen.
How the IT-BT Policy Benefits Companies Setting Up in Mysuru
- Market entry timelines compress significantly: policy-driven regulatory facilitation reduces approval cycles and setup friction, enabling faster operational deployment.
- Cost efficiency improves through lower real estate costs, reduced operating expenses and sustainable expansion models that avoid metro-level overhead — directly enhancing return on investment.
- Talent accessibility strengthens through access to skilled regional workforces, improved employee work-life balance and lower attrition rates compared to metropolitan markets.
- Scalability remains flexible: the model supports phased expansion without long-term infrastructure commitments, accommodating both hybrid growth models and rapid team scaling.
These advantages directly reflect the Karnataka IT-BT Policy 2025–2030 vision.
Why Ready-to-Use Workspaces Matter in Policy-Led Expansion
Speed, operational simplicity and predictable costs are what most companies need when expanding into a new city. This is where flexible, ready-to-use workspaces play a critical role.
Commercial office spaces such as Brigade Vantage on Vinoba Road, and Brigade Point on Gokulam Main Road, enable businesses to establish operations faster, reduce long-term infrastructure commitments and focus on core business functions instead of facility management.
With integrated retail amenities and a collaborative ecosystem, these developments enhance the overall work experience while supporting productivity and business growth. For companies evaluating office spaces in Mysuru, developments like these make policy-led expansion both practical and operationally efficient.
Who Should Consider Expanding to Mysuru Now?
The opportunity holds particular relevance for startups establishing first offices, Bengaluru-based companies deploying satellite operations, and enterprises or GCCs evaluating Tier-2 expansion strategies. Policy support combined with accelerating infrastructure development positions Mysuru for sustained growth as a technology and business destination.
Conclusion
The policy supports decentralised technology growth, positions cities like Mysuru as future-ready business destinations, and enables companies to expand with greater speed, strategic clarity and operational sustainability. Early adopters benefit from cost efficiency, enhanced talent access and accelerated expansion timelines. Explore Brigade's commercial office spaces in Mysuru to see how these workspaces can help turn policy intent into real operational outcomes.
FAQs
1. What does IT-BT stand for?
IT-BT stands for Information Technology and Biotechnology — the two sectors covered by Karnataka's IT/BT (Information Technology, Biotechnology and Science & Technology) Department, currently led by Minister Priyank Kharge.
2. What is the IT-BT policy in Karnataka?
The Karnataka IT-BT Policy for the year 2025-2030 is a government strategy to promote IT, innovation, startups, and technology-driven growth, with a strong focus on expansion beyond Bengaluru.
3. Is the IT-BT Policy the same as Karnataka's Biotechnology Policy?
Not exactly. "IT-BT" commonly refers to Karnataka's IT/BT Department and its flagship Information Technology Policy 2025-2030. Biotechnology has its own separate Karnataka Biotechnology Policy (2024-2029), and there are related policies too, including a GCC Policy 2024-2029. "IT-BT policy" is often used as shorthand for the department's overall technology agenda.
4. Why is Karnataka emphasising IT development beyond Bengaluru?
To alleviate cost, talent and infrastructure pressures while creating balanced growth opportunities across Tier-2 cities.
5. How does the IT-BT Policy benefit companies expanding into Tier-2 cities?
The policy provides streamlined approvals, reduced operational costs, access to regional talent pools and enhanced infrastructure support, including R&D expenditure reimbursement and capital expenditure incentives.
6. Which cities will benefit most from the IT-BT Policy in Karnataka?
Mysuru, Mangaluru, Hubballi-Dharwad, Kalaburagi, Shivamogga, Tumakuru and Belagavi are positioned to benefit significantly from policy-driven infrastructure and incentive programmes.
7. What are the reasons behind Mysuru being a preferred destination for IT companies?
Mysuru offers cost advantages, improving infrastructure, a growing talent base and strategic connectivity — making it an optimal location for scalable technology operations.
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