Karnataka woos IT sector with relaxed rules on labour, land

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BANGALORE, October 23:  The State government on Tuesday announced that information technology (IT) companies would come under essential services with effect from November 1, making them exempt from general strikes and bandhs.

IT and related sectors will also remain outside the purview of the Karnataka Industrial Employment (Standing Orders) Rules, 1946, for five more years. According to these Rules, companies are mandated to define and declare staff details such as working hours, wages, attendance and reasons for terminating an employee’s service, among other terms of employment.

These and a host of new initiatives are part of the new IT policy, which was unveiled by the Chief Minister after opening the State’s annual infotech show, ITE.biz.

‘Unstinted support’

With Karnataka already leading the country in IT services and exports worth Rs. 1.35 lakh crore, Mr. Siddaramaiah said he hoped the incentives would further spur the growth of electronics, start-ups and knowledge-based industries.

He told a 1,000-strong gathering after unveiling the policy, “Karnataka has always been proactive in supporting the growth of the ICT [information, communication and technology] sector…With these incentives, the State government has once again shown that the IT sector is a priority sector in its development agenda.”

Earlier, a cyber Kathakali artiste welcomed the guests from a large screen and laser beams lit the ceremonial lamp, setting a futuristic tone to the opening of the three-day meet.

Land for jobs

The i4 (i to the power of four) policy encompassing IT, IT-enabled services (ITeS), innovation and incentives, offers land allotment incentives linked to the number of jobs a new company creates, especially in regions outside Bangalore Urban and Rural districts. For every 1,000 jobs it generates, the new IT company will get an acre of land at a concessional rate on long lease.

Special incentives for start-ups were aimed at turning the IT capital into the world’s innovation capital by 2020, the Chief Minister said.

‘Total domination’

IT Secretary Srivatsa Krishna said the new package, along with a thrust to animation and semiconductor industries, would give Karnataka “total domination in every IT vertical” in the next seven years.

The State government was also tying up with a few start-ups to offer a host of anytime-anywhere services, he added.

Present at the event were S. Jaipal Reddy, Union Minister for Science and Technology and Earth Sciences; S.R. Patil, Minister for IT, Science and Technology, Planning and Statistics; StateChief Secretary S.V. Ranganath, NASSCOM’s incoming president and the former Telecom Secretary R. Chandrashekar; Infosys Ltd.’s executive vice-chairman and chairman of the State Vision Group on IT S. Gopalakrishnan; and director-general of Software Technology Parks of India, Bangalore, Omkar Rai.

Planning Commission deputy chairman Montek Singh Ahluwalia made a tele-address.

Highlights of new IT policy

IT and related sectors exempted from Karnataka Industrial Employment (Standing Orders) Rules, 1946, for five more years

Suitable clause to protect women, prevent sexual harassment at work

Single window agency to help IT investors

An acre of subsidised land lease for every 1,000 jobs outside Bangalore; company must offer employees Rs. 10,000 or more a month each for two years

Subsidy capped at Rs. 60,000; land incentives exclude existing companies and real estate developers

Power tariff concession to all and stamp duty relief in Mysore, Mangalore

Brand Bangalore 3.0 Society and Bangalore First fund to be set up in association with NASSCOM and others

For start-ups, ready, web-linked business space at concessional rate.

1 Comment

  1. The labour laws is an monitor by central Govt,The IT sector is not a coming under reserved category,all intellectual class starts industry why exemption to be give, the MSME sector promotes employing all undergraduates and trained and provide jobs to such Industries should be given all concessions.

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