Karnataka is sharpening its manufacturing ambitions as India’s electronics production is projected to reach $300 billion by 2026 and the domestic semiconductor market is expected to touch $64 billion.
Speaking at Source India 2026 in Bengaluru, Dr Manjula, Secretary to the Government, Department of Electronics, IT, Biotechnology and Science & Technology, Government of Karnataka, outlined the State’s push to deepen its role across the electronics and semiconductor value chain.
“Karnataka is not just participating in India’s electronics growth story, we are shaping it. With our strong R&D ecosystem, global engineering centres and a focused push on manufacturing, the State is ready to lead the next phase of electronics and semiconductor expansion,” she said.
From R&D powerhouse to manufacturing hub
Karnataka currently accounts for nearly 10% of India’s industrial output and is among the country’s leading electronics exporters, with exports exceeding $4.5 billion — ranking third nationally. The State hosts approximately 500 R&D centres and close to 100 chip design facilities, including those operated by Intel, AMD, Qualcomm, Samsung, GE, Texas Instruments, Lam Research and Applied Materials.
Intel’s largest R&D centre outside the United States and GE’s second-largest global R&D facility are both located in Karnataka, a testament to the State’s longstanding design and engineering strengths.
The government now aims to complement this R&D depth with scaled manufacturing capacity.
The “three Ls”: Liquidity, Land and Labour
Dr Manjula described Karnataka’s strategy as centred around three pillars: liquidity, land and labour.
On policy support, the State has introduced the Special Incentives Scheme for the ESDM sector (2025–2030) and is offering customised packages for investments exceeding ₹500 crore. It has also launched the Karnataka Space Technology Policy (2024–2029) and the GCC Policy (2024–2029), aimed at attracting advanced manufacturing, R&D and global capability centres.
On infrastructure, Karnataka is developing specialised clusters across the State:
– Aerospace and PCB manufacturing in Mysuru
– Consumer electronics in Hubli–Dharwad
– Mobile component manufacturing in Chikkaballapur
– Proposed mobile phone assembly and EV manufacturing clusters near Bengaluru
Two new electronics manufacturing clusters are also being developed at Kochanahalli in Mysuru district and Kotur–Belur in Dharwad district under the Centre’s EMC 2.0 scheme.
The State’s talent ecosystem remains a central lever. Karnataka has 235 engineering colleges, 325 polytechnics and 1,777 Industrial Training Institutes (ITIs), supported by institutions such as Indian Institute of Science. It also hosts around 30 Government Tool Room and Training Centres and a Semiconductor Fabless Accelerator Lab set up in collaboration with India Electronics and Semiconductor Association to nurture chip design start-ups.
Anchoring growth in end-user demand
Karnataka’s manufacturing ambitions are underpinned by strong downstream industries, including automotive, aerospace, defence, medical devices and industrial manufacturing.
Dr Manjula noted that Foxconn has begun construction of a mobile phone manufacturing facility near Bengaluru’s international airport — a signal that global electronics players are increasingly viewing the State as a production base.
The broader context reinforces the urgency. India’s electronics exports have crossed $38.5 billion, growing over 32% year-on-year in FY25, driven largely by mobile phone manufacturing and policy support such as the Production Linked Incentive (PLI) scheme.
With Source India 2026 bringing together manufacturers, suppliers and policymakers, Karnataka’s message was clear: the State intends to move beyond design leadership and capture a significantly larger share of India’s next electronics manufacturing wave.