The Long Game

Karnataka's IT supremacy once again helps it secure pole position among states. But it is not resting easy on its laurels, but making a push for the future by focussing on hardware

- Tarunya Sanjay

When global innovation finds home in Bengaluru and Karnataka, it scales for the world, said Chief Minister Siddaramaiah late last year, setting the tone for what the next technological decade is going to look like for the state.

Karnataka is already a favourite among startups, given its position as the country's top information technology (IT) software hub. And, once again, it clinches the top spot in the Outlook Business Outperformers 2026 rankings. With its dominance in software exports and global IT services, the state secures an overall score of 83.3 and first place among peers for starting up.

Now, the state has made a clarion call to become an IT hardware hub too. Of course, this shift won't be easy. But Karnataka has all the ingredients—significant high-tech exports and a thriving services sector—to make it happen.

As India pushes into electronics manufacturing, electric vehicles (EVs) and semiconductors, the state is positioning itself as the nerve centre of design, engineering and systems integration. This is also a competitive response.

Design Dominance

Karnataka accounts for roughly 10% of India's electronics production and commands about 40% of the country’s electronic design activity, along with nearly half of all electronic product companies.

The state is also home to more than 100 fabless chip-design firms, making it India's largest hub for semiconductor design.