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Karnataka, lying in the south of India is the eight largest state of India in both area and population. Karnataka is predominantly rural and agrarian. Yet, it has also been in the forefront of industrial growth in India. High levels of research and development provide major scope for investment opportunities. Excellent communication facilities and accessibility are provided through broad-gauge railway, airport, national highways and seaports.

Foreign investment in the state has been encouraging. From 1991 to 1997, the state has cleared over 469 foreign proposals with a total worth of Rs 6,708 crore (US $1863.43 million). In the year 1997 itself, the approval was for Rs 3,409,22 crore.

Land area: 191,791 sq. km.
Population: 45 million
Capital: Bangalore
Per Capita Income: Rs 8,082
Inflation Rate: 11.9%

Infrastructure:
The State Government has created several organizations and Institutions to provide infrastructure support to the private sector enterprises. The Technical Consultancy Services Organization of Karnataka offers expert consultancy services to small entrepreneurs at moderate rates.
The Karnataka State Finance Corporation, Industrial Investment Development Corporation, Small Scale Industries Development Corporation and Karnataka Electronics Corporation provide them finance, equity participation, factory sheds and raw material supplies

Incentives:

• Investment subsidy to EOUs and SSIs of 25% of fixed assets (Zone II); and 30% (Zone III)
• Additional capital investment subsidy of 5% of fixed capital for thrust-sector projects
• Special incentives, on a case-by-case basis, for mega-projects with investments of Rs 100 crore
• Special incentives, on a case-by-case basis, for automobile sector investments
• Special package of incentives, concessions, and exemptions for the software industry
• Exemption from purchase tax and from planned power cuts for 100% EOUs
• Sales tax exemption (up to 100% of fixed assets) for periods between 4 and 7 years for new units
• Sales tax deferral (up to 100% of fixed assets) for periods between 5 and 8 years for new units