•Karnataka is set to introduce a specialized policy for the (MSME) sector,
•To enhance development through various incentives and concessions.
•This initiative follows the unveiling of Karnataka's Industrial Policy 2025–30

Karnataka is going to introduce a specialized policy for the micro, small and medium Enterprises (MSME) sector.

The state government's Industries and Commerce Department, through the Karnataka Council for Technological Up gradation (KCTU), issued a tender some time back for engaging a consultant to prepare a new policy. The policy would carry a bouquet of incentives and concessions to be given to enhance MSME development throughout the state.

Authorities revealed that the consultant will examine Karnataka's MSME environment and benchmark the state's strategy with those of Gujarat, Telangana, Maharashtra and Tamil Nadu states which are renowned for having strong MSME ecosystems. "This is the first time that a separate policy is being drawn up exclusively for the promotion of MSMEs," said a senior government officer to Moneycontrol.

MSMEs have been universally accepted as important players in driving economic growth and employment generation in India. "In Karnataka, the industry contributes significantly to the socioeconomic growth of the state by providing jobs to a broad cross-section of society," the official stated.

The move has been welcomed by industry associations. “We’ve long been asking for a separate MSME policy in Karnataka,” said MG Balakrishna, president of Federation of Karnataka Chambers of Commerce and Industry (FKCCI).

As per authorities, although numerous schemes are being implemented to boost MSMEs, there exists a definite necessity for an independent policy that promises more focused interventions. The consultant will be assigned to study the effect of the newly introduced Industrial Policy 2025–30 of Karnataka on MSMEs and submit a comprehensive report about its results.

This global analysis will assist Karnataka in determining the correct interventions to enable Indian MSMEs to compete internationally," reads the tender document. The draft policy will have the vision, mission, strategies, desired outcomes and annual investment and employment targets. It will also include an incentive package to be competitive with the best of national and international standards.

The last policy is anticipated to solve some of the key challenges for MSMEs, including land supply, expensive power, labour laws, access to credit and market linkages. It will also suggest new schemes and advocate structural reforms to enhance MSME governance in the state.

It comes on the back of Karnataka unveiling its Industrial Policy 2025–30 on February 11, aiming to achieve a growth rate of 12 percent every year in industry, draw investment of Rs 7.5 lakh crore, and generate employment of 20 lakh by the year 2030.