K'taka govt wants to be largest purchaser of MSME products, services: Priyank Kharge

In a candid chat at TechSparks, Karnataka Minister of IT-BT Priyank Kharge elaborated on the state government's strategies to bolster startups and MSMEs.

K'taka govt wants to be largest purchaser of MSME products, services: Priyank Kharge

Saturday September 23, 2023,

3 min Read

On the third and final day of TechSparks 2023, Priyank M Kharge, Minister of Information Technology, Biotechnology, Rural Development, and Panchayat Raj, Karnataka government, declared the state government's intention to be the largest buyer of micro, small, and medium enterprise (MSME) products and services.

"The Karnataka government is eager to become the primary customer for MSMEs and startups, with the aim of procuring 5% to 15% of our demand from these businesses," Kharge said in a candid chat with YourStory Founder and CEO Shradha Sharma.

The minister highlighted the Karnataka government's strategies to bolster the business ecosystem and stated that the Elevate programme has been helping state-registered startups for more than 25 years. Under the programme initiated by the Department of Electronics, IT, BT, and S&T, the Karnataka government offers startups a one-time grant of Rs 50 lakh as seed funding.

Kharge also highlighted a special initiative for women entrepreneurs and a rural and social impact programme, pointing at the Udyogini Scheme which encourages women to take loans from banks and other financial institutions to start income-generating activities.


He also emphasised the government's commitment to supporting smaller businesses by encouraging them to present solutions to specific challenges. Additionally, the government was actively working to establish a platform for direct engagement with venture capitalists (VCs).

However, while discussing Bengaluru and Karnataka's potential to offer opportunities for startups, SMBs and MSMEs, Kharge voiced his concerns over why businesses were shifting their goals from value to valuation.

"Over the past couple of years, it appears that we have lost our way. Businesses are fixated on chasing valuations rather than creating real value by solving pressing problems; that's where the true significance lies," he said.

Kharge stressed that successful businesses should not solely revolve around funding but also focus on addressing existing problems.

The minister also noted that while many states claim to work on 'Ease of Doing Business' with a single-window system, "it often leads to many doors". He stated that while reaching out to corporates or MSMEs, the government will understand what it can do to ensure that businesses thrive. “If there is any policy, law detrimental to businesses’ progress, there will be frameworks to ensure that all of them thrive.”

Kharge revealed that the government is making extensive efforts to establish industries in Tier II and III towns such as Hubli-Dharwad, Tumkuru, and Belgavi. The Beyond Bengaluru initiative aims to fortify the manufacturing and tech sectors in these towns with a particular focus on specific industries. The minister confidently predicted that the next semiconductor revolution would take place in Karnataka.

"Our approach will be cluster-based across regions," Kharge explained, emphasising the government's desire to facilitate and empower enterprises in their growth journey.

Edited by Kanishk Singh