Taiwanese contract manufacturer Foxconn, Apple’s primary supplier, is set to receive Rs 6,970 crore in incentives as part of Karnataka’s special incentive scheme for the Electronics System Design and Manufacturing (ESDM) sector from 2020 to 2025. Chief Minister Siddaramaiah made this announcement during the state budget presentation on March 7.
Foxconn has established a mobile phone manufacturing plant in the Devanahalli Industrial Area with an initial investment of Rs 21,911 crore. The company will benefit from an incentive of Rs 6,970 crore under the ESDM policy, as highlighted by the Chief Minister in his budget address.
“Foxconn is setting up a mobile phone manufacturing plant in Devanahalli Industrial Area with an investment of Rs 21,911 crore and will be provided incentives under the ESDM policy” said Siddaramaiah.
The ESDM policy offers various incentives, such as a 25% capital investment subsidy on land, a 20% subsidy on plant and machinery, and a full reimbursement of stamp duty, registration charges, and land conversion fees provided by the state.
Being the first electronics company to receive such a substantial incentive, Foxconn’s presence signifies Karnataka’s commitment toward enhancing its presence in high-end electronics manufacturing.
The Karnataka Employer’s Compliance Decriminalisation and Digitisation Bills are set to be introduced by the government. The Chief Minister emphasized the importance of Karnataka’s sectoral policies in IT, tourism, and biotechnology to stimulate economic growth and create job opportunities.
“These are expected to attract Rs 1 lakh crore in investments, with Rs 13,500 crore committed in subsidies. Karnataka secured $4.4 billion in foreign investment by December 2024-25, ranking third in the country, while exports grew 11.17 percent to $88.85 billion. At Invest Karnataka 2025, the state signed MoUs worth Rs 10.27 lakh crore, projected to create over six lakh jobs,” said Siddaramaiah.
Infra push to Bangalore
CM Siddaramaiah also announced a series of measures for Bengaluru in response to increasing public criticism regarding the city’s poor infrastructure, just ahead of the Bruhat Bengaluru Mahanagara Palike (BBMP) elections.
In a statement, the Chief Minister emphasized the government’s commitment to improving basic infrastructure in Bengaluru, which is vital for the state’s economy. He revealed plans to boost the annual grant from Rs 3,000 crore to Rs 7,000 crore by the year 2025-26.
To effectively manage these funds and implement crucial infrastructure projects, a new Special Purpose Vehicle (SPV) will be established. This move is intended to shift the responsibility for major development projects away from BBMP, which has been under scrutiny for the city’s deteriorating infrastructure.
The government’s budget also includes proposals to extend the Metro line from Kempegowda International Airport to Devanahalli, with plans to introduce 98.6 km of new metro routes within the next two years.
Siddaramaiah announced that progress has been made on the long-awaited Peripheral Ring Road (PRR) project, with land acquisition currently underway by specialized teams. A budget of Rs 27,00 crore has been allocated to construct a 73 km PRR, now named the ‘Bengaluru Business Corridor,’ with support from HUDCO Bank.
Additionally, it was mentioned that the Majestic bus stand in Bengaluru will undergo redevelopment through a public-private partnership (PPP) model to transform it into a modern transportation hub with a commercial complex.
