Karnataka got a quarter of all IT investments in India during 2015-16: Assocham

Karnataka continues to remain the most attractive state for IT investments in the country, with the state accounting for nearly a fourth of the total investment the sector saw during the financial year 2015-16.

According to industry body Assocham, the investments drawn by Karnataka's IT sector during the last financial year stood at Rs 53,396 crore from both public and private sources. The overall investment the country drew in the sector stood at Rs 2.2 lakh crore.

"With a vibrant and productive industrial ecosystem, Karnataka has emerged as the most preferred investment destination in the country as it houses multiple firms in robotics, semiconductor chip design, nanotechnology and advanced materials," said D S Rawat, secretary general of ASSOCHAM, in a statement.

Investment in Karnataka's IT sector has grown at a compounded annual growth rate of 14 per cent since FY05. However, IT investments in the state grew at a slower pace than the overall growth of IT investments in India, which grew at CAGR 17 per cent in the same 10 year period.

"Karnataka government should work towards further improving the infrastructure across the state and promote ease of doing business to lure new investors in large numbers and encourage the existing industries to further expand their base," added Rawat.

Gujarat's IT sector ranked second in attracting investments, raking in about Rs 35,300 crores during 2016-17. Investment in the states grew by 48 per cent in the past 10 years from about Rs 700 crores. Kerala, Andhra Pradesh and Tamil Nadu made up the top five states in attracting IT investments.

Karnataka's capital Bengaluru contributed to over one third of the country's $108 billion dollar IT exports last year. The city is also the de-facto startup capital of the country, drawing a lion's share of venture capital investment made in India and housing close to 4,000 startups as off today.