Karnataka rolls out startup policy with Rs 571 Cr outlay, targets deeptech and growth beyond Bengaluru

Karnataka has announced a new startup policy for 2025–2030, outlining a plan to establish 25,000 new startups over the next five years—with at least 10,000 expected to emerge from clusters beyond Bengaluru.

The state has earmarked Rs 570.675 crore for the policy, which focuses on funding access, incubation infrastructure, market expansion, and regulatory facilitation, according to a government statement.

The policy places strong emphasis on decentralising startup activity beyond Bengaluru and prioritises sectors such as artificial intelligence, blockchain, quantum computing, biotechnology and sustainability-linked technologies. It also highlights seven focus areas: funding and grants, incubation and infrastructure, mentoring and skill development, market access and expansion, international collaboration, inclusion and sustainability, and regulatory facilitation.

As part of the rollout, the government launched a Rs 75-crore ‘Beyond Bengaluru Cluster Seed Fund’ to boost startup activity in emerging non-metro regions. The fund has a Rs 20-crore commitment from the state, while the remainder will be mobilised from institutional and private participation. It will initially focus on the clusters of Mysuru, Mangaluru and Hubballi–Dharwad.

The fund will deploy equity and equity-linked investments ranging from Rs 50 lakh per startup, subject to regulatory limits, and will target sectors including information technology, electronics and semiconductor manufacturing, biotechnology, and AVGC (animation, visual effects, gaming and comics).

Karnataka also announced ELEVATE NxT, a Rs 150-crore deeptech grant programme under its Local Economy Accelerator Program, offering up to Rs 1 crore per startup in milestone-based funding. The programme is open to startups across India working in areas such as AI, robotics, biotech, quantum technologies, and green energy.

The announcements were made at an event recognising 146 startups selected under the ELEVATE 2025 programme. The startups will receive a total committed grant of Rs 38.85 crore. About 43% of the selected startups were women-led, and an equal proportion were based outside Bengaluru, the Karnataka government said.

Since its launch in 2017, the ELEVATE programme has disbursed Rs 287.85 crore in grants to 1,230 startups across the state, according to official data.