Karnataka is the bright spot in the developmental story of India. It epitomizes the best of many worlds. The State is a land of ancient heritage, scenic beauty, thriving wildlife, and rich culture. It is also a land of innovation, industry and a rich talent pool.
The State is a significant growth engine of the national economy with the GDP valued at Rs 20.49 lakh crore ($268 Bn GSDP) for the FY 2021-22, with a projected growth rate of 9.5%. Karnataka ranks 1st in attracting FDI (40%+) in India, 1st in IT and ITeS exports, 1st in total exports across all states. It is home to many large-scale industries across major sectors such as IT & ITeS, Machine Tools, Aerospace & Defence, ESDM, Biotechnology, R&D, and Engineering Design. From Silk to Precision Manufacturing, the State covers the entire tapestry of industry. As a result, it has emerged as an important link in the global supply chain. The State is driven by Bengaluru – the largest technology base of Asia, and the fourth-largest technology hub in the world.
Karnataka has a thriving export ecosystem and was ranked 3rd in the recently released NITI Aayog’s Export Preparedness Index (EPI) Report 2021 state rankings. This has also reflected in the state’s export successes – it exported merchandise goods worth USD 25.9 bn (INR 1,93,064 Cr) in FY 2021-22, accounting for 6.1 percent of India’s total exports. Karnataka is a leader in the country’s services export with its contribution of 41% in the national share valued at USD 102 bn in FY 2021-2022.
While these achievements are significant, the Government of Karnataka is also aggressively working towards further improving the ecosystem through assisting SME’s, FPO’s, and traders by developing export infrastructure across the state through the Government of India’s Trade Infrastructure for Export Scheme (TIES). As a result, the state is one of the leading states to get approvals under TIES.
It is a major exporter of petroleum products, electrical machinery, aerospace components, precision engineering, auto and auto components, organic chemicals, readymade garments, apparels & madeups, pharmaceuticals, plastic components, Jewellery and commodities such as coffee, spices, silk, cashew nuts, incenses and handicrafts.
Bengaluru is one of the biggest success stories of economic development in India, becoming a global hub for multiple sectors. Inspired by the growth of Bengaluru, the government has turned its attention towards other cities in Karnataka under its ‘Beyond Bengaluru’ initiative to bring about a similar growth trajectory for these cities. This is operationalized by strategic policy interventions and by creating a dynamic ecosystem with sharp focus on infrastructure development, increasing the talent availability and bettering market access. It is expected that such initiatives should lead to increasing demand from IT/GCC/ESDM companies to spread their wings in Tier II & III cities.
Karnataka is creating conducive environment for industrial growth and is guided by transparent sectoral policies that provide extensive support for new industries and entrepreneurs. Karnataka is a leader in the Ease of Doing Business. Its business friendly environment, transparent processes, and simplified government rules and regulations have made it easier not just for large companies but also for MSMEs and startups.
Trade and Commerce will be one of the key enablers for India’s economic growth, as India plans to achieve USD 1 trillion exports each in goods and services by 2030. The Government of India has also recognized the importance of focusing upon districts as development hubs, coming out with several initiatives such as the Aspirational Districts, District as an Export Hub Initiative and others.
As India lays down a roadmap towards achieving the Hon’ble Prime Minister’s Vision of a USD 5 trillion economy, a major enabling factor would be transforming districts into export hubs. It will require each district to build upon their capabilities to boost production and connect businesses to foreign markets. Visvesvaraya Trade Promotion Centre (VTPC) is the mandated nodal agency for promotion of international trade for the State of Karnataka under the aegis of the Department of Industries and Commerce and has developed district wise export plans in active participation of District administration, DGFT, DIC’s, Industry associations and all the stakeholders for each of the 30 districts.