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Beyond Investments: Karnataka Prepares New ESDM Policy to Build a Robust Ecosystem

Published: 1.29.2024

The Karnataka government is developing a new Electronics System Design and Manufacturing (ESDM) policy to propel the state's electronics industry forward. The existing policy, implemented in 2013, nears its expiry in September 2025, prompting the government to engage in discussions with industry leaders to formulate a fresh roadmap. 

The ESDM sector plays a pivotal role in Karnataka's economic engine, significantly contributing to its Gross Domestic Product (GDP) and job creation. The current policy has successfully attracted investments, but the government's vision now extends beyond mere investment attraction. It aims to cultivate a robust ESDM ecosystem within the state.


One of the primary challenges impeding Karnataka's ESDM sector is the limited focus on fostering domestic product development and intellectual property (IP) generation. A majority of ESDM units in the state function as contract manufacturers for international companies. The upcoming policy will strive to incentivize the development of homegrown products and IPs. 

The government is also contemplating the establishment of a dedicated ESDM cluster within the state. This cluster would equip ESDM companies with world-class infrastructure and facilities. Additionally, the government is planning to set up an ESDM fund to provide financial aid to startups and entrepreneurs in the sector. 

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