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Karnataka Unveils IT-BT Incentives To Shift Tech Jobs Beyond Bengaluru

Applications are expected to open in December with slots capped on a first-come basis.

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In a bid to pull companies out of Bengaluru’s overcrowded, high-cost ecosystem, the state government has unveiled a new IT-BT Policy.

Overview

  • The 2025–2030 policy offers companies up to ₹50,000 per employee to relocate tech staff from Bengaluru to Tier-2 or Tier-3 cities.
  • Incentives include 50% rent reimbursement up to ₹2 crore, 30% property tax relief for three years, a five-year electricity duty waiver, and a 25% telecom rebate up to ₹12 lakh.
  • Startups investing in advanced technologies such as AI, ML, quantum computing and blockchain can claim 40% reimbursement of R&D expenses up to ₹50 crore.
  • The state has earmarked nearly ₹960 crore over five years, targeting cities including Mysuru, Mangaluru, Hubballi-Dharwad, Belagavi, Kalaburagi, Shivamogga, Davanagere and Tumakuru.
  • Guidelines are expected by early to mid-December with a cap of 100 beneficiaries per incentive category on a first-come basis, according to a widely shared LinkedIn breakdown cited by media, as leaders also signal plans for an IT city in Bidadi.