Karnataka Vision 2025: The Information Technology (IT) Sector

Transcription

1 Karnataka Vision 2025: The Information Technology (IT) Sector Dr. V. Sridhar Dr. S. Rajagopalan Dr. Amit Prakash International Institute of Information Technology Bangalore (IIIT-B) 02 January 2018 Page 1

2 Contents 1. Executive Summary Overview of the IT Sector in Karnataka Karnataka s contribution to the IT sector: Institutional framework (Acts, policies, planning instruments, agencies) Benchmarking Karnataka s IT sector with other peer states Global benchmarks in the sector Strategic Analysis of the IT sector in Karnataka Growth drivers for the sector (strengths, opportunities and enablers) Progress of ongoing GoK schemes and proposed interventions SWOT Analysis of the State IT Sector Vision 2025 for the IT Sector in Karnataka Vision statement for the IT sector in Karnataka Key goals and targets for Key policy directions Implementation Roadmap: Programmes and Budgets for Vision Role of key stakeholders and partnerships (Backward & Forward linkages) Methodology Abbreviations and Keywords Annexures Annexure I: State of Indian IT Sector Annexure II: State of Start-ups in the State of Karnataka Annexure III: Summary of survey responses Annexure IV: Summary of District Level Meeting Notes Annexure V: Summary of IT Vision Documents from comparable countries Annexure VI: Detailed Government departmental expenditure in ICT Annexure VII: Illustration of IT Adoption in Forward Linkage Sectors Annexure VIII: Small Business Set Aside: A U.S. Government Contracting Programme Page 2

3 List of Figures FIGURE 1. START-UPS IN THE STATE IN DIFFERENT SUB SECTORS 6 FIGURE 2. START-UPS IN THE STATE IN DIFFERENT STAGES OF FUNDING 7 FIGURE 3. GROWTH IN NUMBER OF COUNTRIES FOR INDIA S COMPUTER SOFTWARE/ SERVICES EXPORT 11 FIGURE 4. ILLUSTRATION OF BACKWARD LINKAGES 25 FIGURE 5. ILLUSTRATION OF FORWARD LINKAGES 25 FIGURE 6. METHODOLOGY USED IN THE STUDY 26 FIGURE I-4. ESTIMATED REVENUE DISTRIBUTION ACROSS TYPES OF FIRMS 29 FIGURE II-1. START-UPS IN THE STATE IN DIFFERENT STAGES OF FUNDING 30 FIGURE II-2. FUNDING PORTFOLIO OF START-UPS IN THE STATE 30 FIGURE II-3. DISTRIBUTION OF TECH START-UPS IN VARIOUS CITIES OF THE STATE 31 Page 3

4 List of Tables TABLE 1. HIGHLIGHTS OF THE IT SECTOR IN KARNATAKA 6 TABLE 2. STATE GOVERNMENT EXPENDITURE IN IT (IN RS. CRORES) 7 TABLE 3. START-UP INCUBATORS IN THE STATE 8 TABLE 4. SUMMARY OF RECENT STATE POLICIES RELATED TO THE IT SECTOR 9 TABLE 4. COMPARISON OF KARNATAKA S IT SECTOR WITH OTHER STATES 10 TABLE 5. COMPARISON OF KARNATAKA S ICT INFRASTRUCTURE WITH OTHER STATES 10 TABLE 6. MAJOR MARKETS FOR INDIA S COMPUTER SOFTWARE/ SERVICES EXPORT 12 TABLE 7. SPECIAL ECONOMIC ZONES IN THE STATE 12 TABLE 8. SOFTWARE TECHNOLOGY PARKS OF INDIA (STPI) IN THE STATE 13 TABLE 9. SWOT ANALYSIS OF THE STATE OF KARNATAKA 14 TABLE 10. KEY 2025 OUTCOMES FOR THE STATE IT SECTOR 15 TABLE 11. KEY PERFORMANCE INDICATORS AND TARGETS FOR THE STATE IT SECTOR 17 TABLE 12. ENVISIONED PROGRAMMES AND BUDGETS FOR VISION 2025 (TENTATIVE) 22 TABLE I-1. REGION WISE EXPORT OF COMPUTER SOFTWARE / SERVICES 27 TABLE I-2. SHARE OF DIGITAL REVENUE OF REPRESENTATIVE IT FIRMS 28 TABLE I-3. IT/ITES EMPLOYEE DISTRIBUTION ACROSS TYPES OF FIRMS 28 TABLE I-4. EMPLOYABILITY OF SOFTWARE ENGINEERING GRADUATES ACROSS STATES CATEGORIZED IN 25% BINS 29 TABLE III-1. PRIORITY OF DIFFERENT SUB SECTORS IN IT AS ENVISIONED 31 TABLE III-2. RANKING OF DIFFERENT CITIES OTHER THAN BENGALURU ON POTENTIAL TO AN IT CLUSTER31 TABLE III-3. RANKING OF INCENTIVES THAT CAN BE GIVEN BY THE GOVERNMENT OF KARNATAKA FOR START-UPS IN THE IT SECTOR 32 TABLE III-4. AREAS OF CONCERN FOR THE IT SECTOR IN KARNATAKA 32 Page 4

5 1. Executive Summary Vision Statement for the IT Sector State of Karnataka to be Technology driven sustainable progressive society and the Global Innovation hub for all sectors of the State s economy, and innovation capital for the world thereby contributing to more than 25% of State GSDP and 33% of the total Technology related business of India. Key Goals for the IT Sector 1. Making IT as an a important driver of the State S economy by increasing IT contribution from the current USD 60 billion to USD 300 billion; 2. Build a high-tech IT talent pool to cater to over 3 million IT jobs in the State S through skill- upgradation and IT-driven curriculum; 3. To evolve the start-up entrepreneurial eco-system in the State to be the best in the country and the State to be a leading destination globally for start-ups by increasing the number of startups to 20,000 with about 5,000 of them assisted by Venture V Capital al (VC); 4. IT to be the key component for driving sustainable stainable growth in agriculture; Industrial,, rural and urban development and across other sectors of the economy; 5. Making the State S as a test hub for all emerging technologies by creating technology Centers of Excellence in high-intensive intensive areas such as Machine Intelligence & Robotics; Automation and Machine Learning; Big Data Analytics; Secure systems including cyber security and Blockchain; Internet of Things (IoT); and Mobile App development. 6. Enable digital l inclusion across the State S by digitizing all government services and ensuring last mile broadband/wi-fi connectivity. Page 5

6 2. Overview of the IT Sector in Karnataka 2.1. Karnataka s contribution to the IT sector: Table 1. Highlights of the IT Sector in Karnataka 1 Number of IT companies 3,500 Exports Rs. 2.2 lakh crore ($ 33 B) 2 Contribution to State s Gross State Domestic Product (GSDP) 25% Share of Karnataka in country s IT exports 28% Direct Employment 10 lakh 3 Indirect Employment Number of Fortune 500 companies having outsourcing operations in Karnataka Ranking - Best Technology Hubs in the World (as per UNDP report) Ranking - Start-up ecosystems across the world (as per the Global Start-Up Ecosystem Ranking Report 2015) 30 lakh 400 (80% of total) 4 th (after Silicon Valley, Boston and London) 15 th Rank (only Indian city to be ranked within the best 20 start-up ecosystems of the world) Figure 1. Start-ups in the State in different sub sectors 4 1 Source: Economic Survey of Karnataka Includes about 10% of the revenue from Electronic Design and Manufacturing (ESDM) sector 3 The employment includes those in IT sector and about 30,000 in the ESDM sector. 4 Source: Page 6

7 Figure 2.. Start-ups in the State in different stages of funding 5 Table 2. State Government Expenditure in IT (in Rs. Crores) 6 Year IT Revenue Expendit ure IT Capital Expenditure e-government Expenditure Indirect ICT Expenditur es of different departmen ts Total ICT Expenditure State Budget IT Expenditure as % of State Budget , % 5 Source: 6 Sources: (1) Overview of Budget , Finance Department, Government of Karnataka: (2) Summary of Demands for Grants and Charged Appropriations for the Year , Budget , Finance Department, Government of Karnataka: Demand%20for%20Grants%20FULL.pdf Page 7

8 , % , , , % Table 3. Start-up Incubators in the State Other metrics on the contribution of State IT sector are given in Annexure I. Contributions of the technology start-ups are presented in Annexure II Remarks on the State s contribution to the IT Sector: i. Karnataka continues to be the IT hotbed in the country, contributing more than 35% of India s computer software/ services export; ii. Karnataka, especially Bengaluru is the home of almost all major IT companies, both Indian as well as multinationals; iii. The start-up ecosystem is very strong in the State, and Bengaluru is recognized as one of the top cities globally; iv. India has been consistently rising in the ranks of favorite global destinations to open innovation centers and Bengaluru has emerged as the fifth most preferred destination for global multinational companies that are looking to set up innovation centers 8 ; v. Start-up firms work across different sub-sectors and cover the entire gamut of IT space; vi. The State of Karnataka spends about Rs. 500 crores in ICT projects including e- Government projects, apart from a budgeted expenditure of about Rs. 1,361 crores in ICT related purchases. Together these expenditures contribute to about 1% of the State budget; vii. Enabling Digitization for enterprises and consumers is one of the growing areas for the IT sector as shown in Annexure I-2. 7 The budgeted expenditure is estimated from the budget of various departments allocated for computer, information technology services, e-government, and computer literacy and education. Details of the estimates are given in Annexure VI. The budget amount is an estimate as there is no separate head for IT and hence derived through appropriate search terms related to IT adoption. 8 medium=text&utm_campaign=cppst Page 8

9 2.2. Institutional framework (Acts, policies, planning instruments, agencies) Karnataka was the first state in the world to develop and proclaim an IT policy way back in Subsequent to that Karnataka developed many policies across IT sector that are summarized in Table below. These policies led to creation of many schemes, and other instruments to encourage, nurture and grow this sector to enviable levels. Karnataka was the first state to set up a Council of Science and Technology (1975) and the first state to set up the department of science and technology (1980). The state has continued to create departments and directorates in the area of IT and BT. Apart from the department of IT&BT, it has set up the Directorate, Karnataka Biotechnology and Information Technology Services (KBITS) in 2000 and also The Board for IT Education Standards (BITES) in As an outcome of these policy initiatives, International Institute of Information Technology Bangalore (IIIT-B) with a mission to provide higher technical education and engage in research was set up in These proactive initiatives have led Karnataka to the achievements mentioned in However, we must also note that the progress is not to the desired level in the following aspects: i. The value added and persons employed in the micro and small industries in the IT, ITES sector; ii. Geographic dispersal of industries; iii. The penetration of the use of IT products and services in the production, distribution and consumption of various goods and services of the state and in India, especially in sectors of Agriculture, Health, traditional manufacture ( handicraft/handloom), travel and tourism; iv. Exports to the world from Karnataka is not well diversified with Banking, Financial Services and Insurance (BFSI) is almost two thirds of all exports; v. Conversion of newer requirements of skills and knowledge of industry and start-ups does not get translated quickly enough in our technical education curriculum. Table 4. Summary of recent State Policies related to the IT sector S.No. Act/ Policy and the Corresponding Year of Formulation 1 Government of Karnataka Information and Communication Technology Policy 2011 (2011) 2 Karnataka Electronic System Design and Manufacturing (ESDM) Policy 2013 Highlights Setting up of research hubs for R&D in ICT; setting up of investment regions for ICT firms; innovation parks for MSMEs; education and nurturing talent pool; incentives for export oriented enterprises; special incentives for enterprises coming up low HDI districts Preferential Market Access for Karnataka ESDM companies in departments of GoK; setting up of ESDM innovation centres; setting up of Semiconductor IP and Fables Chip Design fund; setting up of electronics manufacturing clusters; incentives for patents and IPR; incentives for capital investment in ESDM sector Page 9

10 3 Karnataka Information and Communication Technology Group 2020 (2013) 4 Karnataka Animation, Visual Effects, Gaming and Comics Policy 5 Karnataka I 4 (IT, ITES, Innovation Incentives) Policy 6 Karnataka Start-up Policy Incentives for ESDM patents/ IPR from Karnataka; incentives for capital investment in ESDM; encourage ESDM clusters; create a focused ESDM fund; export and domestic sales incentives; development of emerging ICT centres in Mysuru and Mangaluru; set up Karnataka Rural Technology and Business Operations PPP for promotion of Fine Art schools; Setting up of Karnataka Animation VFX, Gaming and Comics (KAVGC) Centre of Excellence; setting up of KAVGC venture capital fund; infrastructure development through KAVGC parks Employment linked incentivisation of Land Allotment outside BBMP limits; Stamp duty exemption in Mysuru and Mangaluru in additional to other locations; concessional power tariff; skill development programme; better access to SMEs and start-ups Start-up funds through Fund of Funds ; incubation infrastructure through PPP model; assist in setting up Technology Business Incubators in institutions of higher learning; New Age Incubation Network in Institutes in tier-two cities Benchmarking Karnataka s IT sector with other peer states Table 4. Comparison of Karnataka s IT Sector with other States 9 Contribution to the IT Exports Revenue in (US $ M/ %) No. of IT Start-ups/ % age Estimated Direct Employment in the IT sector (in millions)/ %age Karnataka Telengana Tamil Nadu 39,731/ 12,989/ 14,822/ 37.11% 12.13% 13.85% Maharashtra Haryana 14,822/ 13.85% 7,640/ 7.14% India 107,050/ 100% 432/ 35% 59/ 4% 54/ 4% 274/ 22% 122/ 10% / 33% 0.4/ 11% 0.4/ 0.7/ 19% 0.2/ 5% % Table 5. Comparison of Karnataka s ICT Infrastructure with other States 10 Karnataka Telengana Tamil Nadu Maharashtra Haryana India 9 Sources: (1) Electronics and Computer Software Export Promotion Council (2) National Skill Sector Council, NASSCOM (3) Tracxn.com 10 Sources: TRAI: The Indian Telecom Services Performance Indicators (Apr-Jun 2017), Page 10

11 Mobile Density: Total/ Rural %/ 58.30% 96.07%/ 60.51% %/ 94.59% %/ 71.05% 91.69%/ 64.52% 92.12%/ 57.31% Internet Subscribers per 100 population: Total/ Rural Broadband Subscribers as a percentage of Internet Subscribers: Total/ Rural 44.32/ / / %/ 63% 73%/ 63% 36%/ 25% 43.89/ / %/ 70% 77%/ 71% 33.47/ %/ 56% Remarks on the performance of the State compared to other comparable states: i. The State still continues to be the magnet for technology start-ups compared to other states; ii. The State s ICT infrastructure is comparable to other similar states and is better than country average Global benchmarks in the sector State of Karnataka is very similar in the area of IT to some of the developed countries. India, Ireland and Israel are often referred to as 3Is in the area of IT as pioneers of products and services. Annexure V presents highlights of the IT vision documents of select countries of Ireland, Estonia and Brazil. 3. Strategic Analysis of the IT sector in Karnataka 3.1. Growth drivers for the sector (strengths, opportunities and enablers) Figure 3. Growth in Number of Countries for India s Computer Software/ Services Export Source: Electronics and Computer Software Export Promotion Council Page 11

12 Table 6. Major markets for India s Computer Software/ Services Export 12 Values in USD million Country Name GDP Computer Software Export Value % of Sectoral Total % of Country's GDP U.S.A 18,569,100 61, % 0.33% United Kingdom 2,618,886 19, % 0.73% Singapore 296,966 4, % 1.63% Netherlands 770,845 2, % 0.34% German Rep. 3,466,757 2, % 0.07% Australia 1,204,616 2, % 0.19% Canada 1,529,760 1, % 0.09% China 11,199,145 1, % 0.01% Switzerland 659, % 0.13% Sweden 511, % 0.17% Others 33,533,697 10, % 0.03% Total 74,360, , Region-wise growth of sector is included in Annexure I-1. Remarks on the growth drivers in the sector: i. The IT sector continues to grow despite threats of automation and India losing its cost arbitrage; ii. Though the U.S. and Europe/ UK continue to be the major nations to which our IT sector contributes, there are still a group of nations including those in the Pacific region where the markets could potentially be exploited. iii. Major part of the revenue as well employment generated are from large and medium firms. The emerging and small firms contribute to just about 20 and 30 percent respectively to the total IT revenue and employment in the sector Progress of ongoing GoK schemes and proposed interventions Table 7. Special Economic Zones in the State 13 SEZ Total IT/ITES Districts Operational Bangalore -13, D.Kannada-1, Mysore-1 Formally Approved Bangalore - 33,Hassan- 1, Dakshin Kannada- 3, Mangalore- 2, Mysore- 5, Shimoga- 1, Udupi-1, Mandya-1 12 Source: (1) Electronics and Computer Software Export Promotion Council (2) The World Bank, GDP Ranking, 2016, 13 Source : 1. Government of Karnataka 12th Five Year Plan ( ) Sector Paper: Services-Tourism & Hospitality, Construction and IT/ITeS 2. Page 12

13 Table 8. Software Technology Parks of India (STPI) in the State 14 STPI Sub- Key Highlights Centers Hubballi Operational from May Incubation facility for Small and Medium scale Enterprises (SMEs) in Northern Kannada region. 30 companies are incubated at STPI Hubballi. Mangaluru Incubation facility for Small and Medium scale Enterprises (SMEs) in Dakshina Kannada region. 16 companies incubated in STPI Mangaluru Manipal Operational from November software exporters operate from Manipal STPI. Mysuru Operational from November Software exports of Rs. 2,400 crores from STP/EHTP units during FY More than 9500 manpower working. 12 IT companies, 10 ITES companies, 4 EHTP units Remarks on the progress of various GoK schemes: i. Though STPs and SEZs have attracted large IT firms, both domestic and multinationals, they are predominantly located only in Bengaluru. There is very little effect of these schemes in other cities such as Mangaluru and Mysuru. 14 Source : Software Technology Parks of India, Bengaluru Page 13

14 3.3. SWOT Analysis of the State IT Sector Based on the growth of the IT sector in the country and the State, table below indicates the Strength, Weakness, Opportunity and Threat analysis if the sector in the State (refer also to Annexure I and II as appropriate). Table 9. SWOT Analysis of the State of Karnataka STRENGTHS i. Recognition of Bangalore amongst the most sought after global destinations for outsourced IT services; ii. Presence of almost all major IT companies in Bangalore, both Indian as well as multinationals providing IT and product engineering services; iii. Presence of a large number of engineering, management and other professional colleges and higher education institutes (within the State as well as in its immediate neighborhood. OPPORTUNITIES i. Emergence of a vibrant startup ecosystem with support from the government and venture funds, some of them set-up by Industry veterans with a, presumably, better appreciation of local sensibilities. ii. Increased government spending on building a national digital infrastructure that opens up significant opportunities in reaching out to a vast and, in most parts, yet untapped domestic market; Expertise developed in producing for the domestic market can be leveraged for expansion into similar markets of Asia-Pacific and Africa (see Annexure I-2). WEAKNESSES i. Disproportionately high concentration of IT companies and their production/delivery units within Bangalore; Mysore, Mangalore and Hubballi-Dharwad, for example, have not been attract the IT firms to locate in these cities (see Annexure II-1); ii. Heavy reliance on the external sector (concentrated in a few countries of North America and Europe) and on providing outsourced IT services leading to under-development of design capabilities to cater to needs of the domestic and other emerging market spaces in the Asia-Pacific and Africa (see Annexure I-1). iii. Large and Medium firms contribute to major revenue and employment generation with emerging and start-ups contributing less than 25% (see Annexure I-3 and I-4). iv. Employability of graduates from Institutions in the State is a concern (see Annexure I-5). THREATS i. Changing landscape of the worldwide IT spending, increased automation and increasing costs of firms located in the State might lead up to the State IT firms (especially the large and SMEs) losing its leading position in revenue/ profit and employment generation; ii. State might lose its competitiveness in attracting and retaining firms and employees due to poor infrastructure, especially in Bengaluru. iii. Large IT firms due to their mere strength may cannibalize the emerging and start-up firms in attracting talent; iv. Increased protectionism in US/ Europe leading to uncertainty in market demand for IT services Page 14

15 4. Vision 2025 for the IT Sector in Karnataka 4.1. Vision statement for the IT sector in Karnataka The vision statement as envisioned is as follows: State of Karnataka to be Technology driven sustainable progressive society and the Global Innovation hub for all sectors of the State s economy, and innovation capital for the world thereby contributing to more than 25% of State GSDP and 33% of the total Technology related business of India Key goals and targets for 2025 Table 10. Key 2025 Outcomes for the State IT Sector S.No. Key Goal 1 Making IT as an important driver of the State economy by increasing IT contribution from the current USD 60 billion to USD 300 billion; 2 Build a high-tech IT talent pool to cater to over 3 million IT jobs in the State through skill-upgradation and IT-driven curriculum; Strategic Direction i. All sectors to be driven by technology and government to lead the new generation technology adoption. ii. Create technology parks and provide incentives and infrastructure facilities for large IT firms to set up satellite development centers which can attract MSMEs and start-ups also to these locations for sustainability of these IT clusters iii. Develop IT Clusters outside Bengaluru - Diffuse significant number of large and SMEs in the sector and start-ups to cities such as Mysuru, Hubbali/ Dharwad, Mangaluru, Tumakuru and Belagavi iv. Improve ICT and non-ict infrastructure in the State to be the best in the country i. Embedding new and emerging Information technology content in current IT academic curriculum ii. Improve employability of graduating engineers and build skills in emerging technology intensive areas to cater to the emerging demands of the industry and market places Page 15

16 3 To evolve the start-up entrepreneurial eco-system in the State to be the best in the country and the State to be a leading destination globally for startups by increasing the number of startups to 20,000 with about 5,000 of them assisted by Venture Capital (VC); 4 IT to be the key component for driving sustainable growth in agriculture; Industrial, rural and urban development and across other sectors of the economy; iii. Provide advanced skill development and knowledge enhancement programmes, through the Karnataka State Higher Education Council, based on NPTEL model, in emerging areas such as secure systems, mobile, data analytics, AI and Robotics, and IoT. iv. To encourage and build MOOC (Massive Open Online Courses) for IT based skilling to drive upskilling of IT skill sets across primary, high school, graduate and post-graduate talent pool i. Fast-track development of reforms for Ease of Doing Business in the state to encourage more digital-driven start-up opportunities ii. Developing a open government data portal which can be accessed by entrepreneurs for development of their products & Service iii. Develop task groups with domain expertise players, industry players, government players iv. Creating a repository of intellectual property rights v. Creating robust incubator infrastructure in the state and enabling easy access to use the facilities vi. Facilitate new policies to support emerging IT technologies adoption in public service delivery i. Improve IT adoption in sectors like Agriculture( including horticulture, animal husbandry, sericulture etc.), Energy, Housing, Irrigation, Transport, Health, Education and Environment in the production process and department functioning as well ( admin, human resources, finance etc.) to add value to the sector ii. iii. iv. Creating a mechanism interfacing industry academia government Building a synergy council which will be having a convergence of various sectors databases to explore, develop and deploy IT products and services that will increase productivity of these sectors and help leverage adequate cross-linkages By establishing a department of innovation and technology which will be handling all new technologies across all sectors in one place 5 Making the State as a test hub for all emerging technologies by creating technology Centers of Excellence in high-intensive areas such as Machine Intelligence & Robotics; Automation and Machine Learning; Big Data Analytics; Secure systems including cyber security and Blockchain; Internet i. Creating a Global Innovation City span across 400 acres land where global multi-national companies can create a manufacturing base for all their emerging technologies and where new startups across the country can use the varied set of facilities available in the City such as Plug and Play centers, Incubators, R&D centers, etc. to facilitate collaboration and building relationships to develop innovative solutions. ii. Nurture development of new products/ services in select technology intensive new areas such as AI & Robotics, Data Analytics, Advanced Communication Services, Secure systems and Internet of Things Page 16

17 of Things (IoT); and Mobile App development. iii. Build Industry, Academia and Government Interface for start-ups to interact and develop key whereabouts to support their innovative product or service 6 Enable digital inclusion across the State by digitizing all government services and ensuring last mile broadband/wi-fi connectivity. i. Ensure broadband and wife access to all villages in the state ii. Expand fiber-optic network across the stat iii. Digitize all citizen-centric government services iv. Driving digitization in all government departments to shift to paper-less offices/e-office systems Based on the strategic outcomes above, following Key Performance Indicators of the sector have been derived using data collected from secondary sources, data from survey of experts (enclosed in Annexure III) and district level workshop proceedings (enclosed in Annexure IV). Table 11. Key Performance Indicators and Targets for the State IT Sector S.No. Key Performance Indicators Current Target for 2022 Target for Contribution of the State IT Sector 1.1. Contribution of the State IT Sector revenue USD 60 USD 180 billion USD 300 billon billion 1.2. Contribution of IT sector to domestic IT products/ services revenue 17% 20% 25% 1.3. ICT budget as percentage of Total budget of the State (includes e- 1.00% 1.50% 2.00% government, ICT infrastructure and ICT procurement of goods and services by different state departments) 1.4. Direct employment in the IT sector 10 lacs 20 lacs 30 lacs 2. High technology incubation 2.1. National Centres of excellence in high technology areas Global Innovation City for multinationals and start-ups NA of 400 acres with a built-up space of 10 million sq.ft 2.2. Technology incubators outside Bengaluru in association with Institutes in NA 1 2 each district 2.3. Number of patents for which financial support is provided by the GoK NA State patent pool including X number of patents for use by firms in the socio-tech space X = 200 X= Start-ups and SME sector 3.1. Number of start-ups 5,000 10,000 20, Number of high-tech business start-ups 1,000 3,000 5,000 Page 17

18 3.3. Percentage of IT start-ups in the State to Total 35% 45% 50% 3.4. Number of Unicorns (valuation more than $ 1 billion) Rank of Bengaluru in Global Start-up Eco system Contribution of emerging and start-up firms to IT sector revenue 20% 25% 30% 3.7. Contribution of emerging and start-up firms to IT sector employment 30% 40% 50% 3.8. Preference in Government purchases at all levels of government ( departments, agencies, companies, autonomous bodies, zilla panchayats, ULBs etc) for the micro, small and start-up sector. Example case study of the US contracting policy along these lines is included in Annexure VIII. NA 10% 15% 3.9. Participate in equity of at least X number of start-ups per year per select district up to an amount of Y crore per start up X=5; Y= Rs. 50 lacs X=10; Y=Rs. 1 Crore 4. Sectoral adoption of IT 4.1. IT spending by State departments (other than e-government, and IT) as 0.70% 0.85% 1.00% percentage of total budget 4.2. Number of government services available online NA Minimum value add (as a percentage of total) in sectors such as Agriculture ( including horticulture, animal husbandry, sericulture), Energy, Housing, Irrigation, Transport, Health, Education and Environment must come from units having 10% or more of IT embedded processes NA 5% 10% 5. IT clusters outside Bengaluru 5.1. Percentage of IT revenue coming from cities other than Bengaluru in the State NA 15% 25% 6. Skill development 6.1. Improve employability of Software Engineers graduating out of State colleges percentile Above 75 percentile on par with Delhi Above 90 percetile 7. Infrastructure development 7.1. Broadband penetration in the State per 100 population: Total Broadband penetration in the State per 100 population: Rural Number of public Wi-Fi hot spots in every district per 100 population NA 1 2 Page 18

19 4.3. Key policy directions Setting up of IT Synergy Council (ITSC): It is proposed to establish an IT Synergy Council (ITSC) under the KJA ( Karnataka Knowledge Commission) to explore, develop and deploy IT products and services that will increase productivity of sectors such as agriculture, health, education, law and justice, traffic and transportation, traditional manufacturing, travel and tourism and urban development. Examples of the implementation of IT Adoption in various sectors is illustrated in Annexure VII. The composition of ITSC shall be as follows: 1. Secretaries of IT-BT, agriculture, education, health, education, law and justice, traffic and transportation, traditional manufacturing, travel and tourism, chaired by the Additional Chief Secretary nominated by the Government; 2. Up to five non-official members or nominees of KJA; The functions of ITSC shall be as follows: 1. Provide directions to the associated sectors for the deployment of suitable IT products and services for improvement of efficiency, productivity and citizen benefits; 2. Provide directions to the associated sector departments for the implementation of their e-government services; 3. Provide inputs regarding the implementation of open architecture and associated platforms across the various sectors for building inter-operable IT products and services. 4. To assess the economic impact of using IT; 5. To analyze preferential access to tech start-ups for certain government projects in allied sectors Setting up of Centres of Excellence: Setting up the Centres of Excellence (CoEs) in each of the five following identified areas, housed in higher education Institutes of excellence or suitable industry bodies: 1. Machine Intelligence & Robotics; 2. Automation and Machine Learning; 3. Big Data Analytics; 4. Secure systems including cyber security and blockchain; 5. Internet of Things (IoT); and 6. Mobile App Development. The objectives of these CoEs shall be as follows: 1. To conduct state of the art research in the above areas; Page 19

20 2. To provide academia-industry interface for commercialization of research ideas in to commercialization; 3. To spread the application and use of associated technologies across different sectors such as agriculture, education, health, law and justice, urban development and so on; 4. To incubate start-ups in the associated technology areas. 5. To conduct on-line and in-class training programmes in the technology areas for skill augmentation of graduating students, and tech entrepreneurs, and government officials; 6. To support development of patents and other forms of intellectual properties in the technology areas; 7. To provide virtual consulting services on the technology areas for start-ups and tech entrepreneurs; 8. To scale up businesses, especially start-ups to commercialize the developed technology through a sharing of Intellectual Properties and licensing mechanism Setting up of District level Innovation Centres: Creating an innovation centre in each of the 30 districts, anchored at one of the engineering colleges/ universities in the district, with the following objectives: 1. To incubate start-ups by local entrepreneurs that use local resources to develop IT based product/ service including fabless design; 2. To involve industry-academia linkages by involving students in the associated colleges/ universities in their final years to do internships in the firms located in the innovation centre and also to work in these start-ups after graduation; 3. To help firms in the innovation centres to file patents and other forms of intellectual properties; 4. To promote development of socio-tech ventures that benefit the local community; These innovation centres shall be equipped with the following: 1. Physical space hosted at a higher education Institution of repute within each district; 2. Plug-and-play infrastructure including robust high speed Internet connectivity; 3. Set of licensed or open source software tools as relevant for the innovation centre, including those for fabless and embedded design as applicable; 4. A video conferencing facility for interacting with the other district level innovation centres across the state ; 5. These innovation centres to be scaled up to Software Technology Parks in each district Setting up of Global Innovation City: Create a Global Innovation City spanning across 400 acres land with the following objectives: Page 20

21 1. where global multi-national companies can create a manufacturing base for all their emerging technologies; 2. where new startups across the country can use the varied set of facilities available in the City 3. where Plug and Play centers, Incubators, R&D centers, etc. are available to facilitate collaboration and building relationships to develop innovative solutions; 4. suitably located outside Bengaluru with robust IT and non-it infrastructure; 5. show-case the State s ambition for IT led innovation and growth. Page 21

22 5. Implementation entation Roadmap: Programmes and Budgets for Vision 2025 The budget for ICT goods and services of different departments of the State is given in Annexure VI. We envision the following programmes and associated budgets for achieving the targets set for 2025 in addition to the existing department budgets. Table 12. Envisioned Programmes and Budgets for Vision 2025 (tentative) Goal Type of Programme Programme Particulars Budget (in Rs. Crores) Increase the penetration of IT in all other sectors As above Setting of CoEs and capability building programmes in emerging technology areas Innovation sand box at districts; participate in equity of selected startups at taluka level IT synergy council at KJA Centres of Excellence (CoEs) in emerging technology areas All 30 districts 100 start ups per year INR max 1 crore per startup For studies and for developing ideas / themes / challenges to be worked by the Consortium and startups at district Five CoEs in higher Institutions of repute or industry bodies in the following areas: Machine Intelligence & Robotics; Automation and Machine Learning; Secure systems including cyber security and Page 22

23 blockchain; Internet of Things (IoT); and Cloud Computing; As above As above District Level Start-up incubation and innovation Programmes and support for MSMEs Subsidy for women students to undertake diploma level programmes Both support to patenting and licensing patents required for product development Setting up innovation centres at district level with 40,000 sq. ft of co working space, labs etc at 5 crore per centre per year Rs 25,000 per student, 10,000 students per year for three years 100 patents support a year at Rs 10 lakhs ( national and international patenting ) Licensing 100 patents a year at about Rs 10 lakhs per patent per year 5 districts per Rs5 crore per innovation centre for establishment and Rs 1 crore per year per centre for operation million sq. ft built-up area As above Global Innovation City with plug-andplay infrastructure Infrastructure capex provision. Opex to be recovered from units using the centres As above Page 23

24 As above New Enterprise promotion in small town, incentives and subsidies Preference in government purchases : 15% of all IT purchases ( hardware and software ) at all levels to be from micro, small enterprises and start ups Waving of stamp duty for registration, reimbursement of GST, subsidy for hardware/software etc : 500 enterprises a year Rs 10 lakh per enterprise for two years Budget required for monitoring Total Page 24

25 6. Role of key stakeholders and partnerships (Backward & Forward linkages) The forward and backward linkages are illustrated in the following two figures Figure 4.. Illustration of Backward linkages Education: Higher education in technology areas Industrial Development: IT clusters in cities other than Bengaluru Rural Development: Rural IT/ BPO centres Skilling & Employment: Improving employability IT Sector Infrastructure Development: ICT and non ICT Figure 5.. Illustration of Forward linkages Page 25

26 Remarks on the backward and forward linkages: 5. The backward linkages need to be strengthened to improve the penetration, diffusion and adoption of IT and increase the contribution of the IT sector to the State s economy and employment; 6. The forward linkages clearly show potential of the use of IT in different sectors to achieve improved efficiency, productivity, welfare and employment. 7. Methodology The methodology we used in this study is represented in the following Figure. Figure 6.. Methodology used in the study Secondary Data Sources including existing policy documents Online survey of experts in the sector News briefs by State industry leaders in the past 1-2 years Inputs on the sector from District level workshops Inputs from cross-sector workshops Synthesize and Analyze Report 8. Abbreviations and Keywords Abbreviation/ Keyword Explanation CoE Centre of Excellence ESDM Electronic System Design and Manufacturing ICT Information & Communication Technologies IoT Internet of Things that includes machine-to-machine communication ITES IT Enabled Services KBITS Karnataka Biotechnology and Information Technology Services KJA Karnataka Jńana Aayoga (Karnataka Knowledge Commission) MSMEs Medium, Small and Micro Enterprises NASSCOM National Association for Software and Services Companies SEZ Special Economic Zones STP Software Technology Parks Page 26

27 Annexures Annexure I: I State of Indian IT Sector Table I-1. Region wise Export of Computer Software / Services Source: Electronics and Computer Software Export Promotion Council Page 27

28 Table I-2. Share of Digital Revenue of representative IT firms 16 Share of Digital Revenue ($ billion) % 23.0% % % Accenture Cognizant TCS Wipro 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Revenue for Full Year Digital Revenue Traditional Revenue Digital Revenue as % of Total Revenue Table I-3. IT/ITES Employee distribution across types of firms 17 Estimated IT/ITeS Employee Distribution Across Company Types (in million) Large Medium Emerging Small India Karnataka 16 Source: Sood, Varun. Muted growth in legacy biz, digital struggles twin worries for Indian IT. Mint, October 30, Sources: (1) Survey on Computer Software & Information Technology Enabled Services Exports: , RBI (2) Economic Survey of Karnataka (3) National Skill Sector Council, NASSCOM Page 28

29 Figure I-4. I Estimated revenue distribution across types of firms 18 Estimated IT/ITeS Revenue Distribution Across Company Types (in billion rupees) Large Medium Emerging Small India Karnataka Table I-4. Employability of Software Engineering Graduates across States categorized in 25% bins 19 Software Engineer IT Services Top 25 Percentile Bihar + Jharkhand Delhi Punjab Uttarakhand 75 to 50 Percentile Gujarat Madhya Pradesh Maharashtra West Bengal 50 to 25 Percentile Haryana Karnataka Orissa Rajasthan Bottom 25 Percentile Andhra Pradesh Chhattisgarh Kerala Tamil Nadu Uttar Pradesh Bihar + Jharkhand Delhi Kerala Orissa Haryana Karnataka Punjab West Bengal Andhra Pradesh Chhattisgargh Uttarakhand Uttar Pradesh Gujarat Himachal Pradesh Maharashtra Rajasthan Tamil Nadu 18 Sources: (1) Survey on Computer Software & Information Technology Enabled Services Exports: , RBI 19 Source: Source : National Employability Report - Engineers %20Engineers%20Annual%20Report% pdf National Employability Report - Engineers Page 29

30 Annexure II: : State of Start-ups in the State of Karnataka Figure II-1.. Start-ups in the State in different stages of funding Figure II-2. Funding portfolio of Start-ups in the State Page 30

31 Figure II-3. Distribution of Tech Start-ups in various cities of the State 20 Annexure III: : Summary of survey responses IT Sub Sector Table III-1. Priority of different sub sectors in IT as envisioned Source: From Survey data Secure Systems: Cyber Security, Authentication, Communication and Network 1 Security, Mobile Security, Cryptography Data Sciences: Big Data Mining & Analytics 2 Internet of Things 3 Products: Design, Engineering and Management 4 Artificial Intelligence & Robotics Communication Networks: 5G and beyond 5 Large Scale Software Systems: Design, Development, Testing and Project 6 Management High Performance Computing 7 Nano electronics, Electronic System Design, Testing 8 Mobile App development and testing 9 Priority Table III-2. Ranking of different cities other than Bengaluru on potential to an IT cluster 20 Source: Page 31

32 Source: From Survey data City Ranking Based on Experts Survey Mysuru 1 Hubbali/ Dharwad 2 Mangaluru 3 Tumakuru 4 Belagavi 5 Hassan 6 Davanagere 7 Ballari 8 Gulbarga 9 Chitradurga 10 Hosapete 11 Table III-3. Ranking of Incentives that can be given by the Government of Karnataka for start-ups in the IT sector Source: From Survey data Potential Incentives Ranking based on Survey Create Virtual Incubation Centre for facilitating networking and exchange of 1 ideas, funding and mentorship Be the first customer 2 Providing incentives including space and tax sops for building digital 3 government applications and services Provide seed funding/ grant for start-ups 4 Reserve, say 15% of all procurement in any department from registered 5 start-ups Make an advance purchase commitment 6 Table III-4. Areas of concern for the IT sector in Karnataka Areas of Concern Ranking in terms of Severity Lack of non-it infrastructure (e.g. schools, roads, transport) in cities of 1 Karnataka for growth of the sector Lack of good collaboration amongst educational Institutions, the industry 2 and government Declining cost arbitrage of the sector due to increase in costs of operation 3 in the State Inadequate employability of graduating workforce 4 Lack of local market of adequate size 5 Inadequate IT infrastructure (e.g. Internet bandwidth, mobile broadband 6 connectivity) in cities of Karnataka for growth of the sector Lack of incentives for start-ups 7 Declining competitive advantage of the State 8 Page 32

33 Annexure IV: Summary of District Level Meeting Notes Highlights of the District level inputs Count of Input Innovation centres, incubation centres, coworking spaces, SEZ for startups, Startup campus, mentoring of 14 start ups Belagavi 1 Chamarajanagar 1 Chitradurga 1 Dakshina Kannada 1 Dharwad 1 Kalaburgi 1 Mandya 1 Mysuru 1 Raichur 1 Tumakuru 1 Udupi 1 Uttara Kannada 1 Vijayapura 1 Yadgiri 1 Ask large/mega IT industry to set up branches or establish new facilities 11 Bidar 1 Chikkaballapur 1 Dakshina Kannada 1 Davangere 1 Dharwad 1 Hassan 1 Kolar 1 Koppal 1 Mysuru 1 Shivamogga 1 Udupi 1 Skill development, internship, IT training in school 10 Bellary 1 Chikkamagaluru 1 Dakshina Kannada 1 Hassan 1 Kodagu 1 Mysuru 1 Raichur 1 Ramanagara 1 Tumakuru 1 Page 33

34 Udupi 1 Rural BPO 8 Bagalakote 1 Bellary 1 Dakshina Kannada 1 Davangere 1 Kalaburgi 1 Mysuru 1 Udupi 1 Uttara Kannada 1 Public information kiosks/apps for information/digitization 8 Bellary 1 Bengaluru Rural 1 Chikkaballapur 1 Chikkamagaluru 1 Chitradurga 1 Kodagu 1 Ramanagara 1 Udupi 1 Public WiFi/High Speed Internet/VC capability 5 Bellary 1 Chikkamagaluru 1 Haveri 1 Kodagu 1 Uttara Kannada 1 Financial incentives ( lower taxes etc) for start ups in rural areas 4 Kalaburgi 1 Koppal 1 Mysuru 1 Tumakuru 1 IT infrastucture, software/hardware parks, roads, power etc 4 Chikkamagaluru 1 Kalaburgi 1 Ramanagara 1 Uttara Kannada 1 Decentralize IT startup approval 2 Kalaburgi 1 Yadgiri 1 Awards for IT innovation and research at district levels (Inspire) 1 Bellary 1 Grand Total 67 Page 34

35 Page 35

36 Annexure V: Summary of IT Vision Documents from comparable countries IRELAND STRATEGIC IMPERATIVES OF ICT VISION Ensure Ireland is internationally perceived as a competitive location for ICT activity Track the development of new EU & Irish regulations and their impact on the ICT sector Lobby Government to ensure that the Irish tax regime remains competitive for both FDI and the indigenous sector Work with revenue to ensure that Ireland has an effective trade policy for exporting companies Develop marketing materials (with IDA) to promote Ireland as a location of choice for new or further investment by foreign owned ICT companies ISA & ICT Ireland continue to develop their strategic policies in relation to developing scale in the indigenous ICT sector Ensure that Ireland is one of the best places to carry out and manage efficient R&D Lobby Government & agencies (IDA, EI & SFI) to ensure that there is a national focus on applied R&D ESTONIA DIGITAL AGENDA 2020 ICT infrastructure for economic growth, development of state and well-being of individuals Improving access to the internet Development of a common service space for the public and the private sector Better ICT skills: for more jobs with higher added value, increased international competitiveness and higher quality of life Increasing digital literacy for improving personal well-being Development of higher ICT skills Smarter governance and public administration Development of better public services by using ICT Higher inclusion and participation with ICT Better decision-making with ICT Greater awareness of e-estonia in the world Monitoring, analysis and promotion of the development of information society Sharing Estonia s ICT experience internationally BRAZILIAN INNOVATION SYSTEM POLICY PROPOSAL Macroeconomic policies and complementary policies could be made more supportive of explicit innovation policy programs. There are some inefficiencies in the subsystem of policy and regulation that require legislative action such as reforming the complex Brazilian tax system or removing the barriers to implementing public procurement for innovation. Mechanisms for competition, cooperation, and accountability should be established and reinforced in mission-oriented policy programs, in order to help balance the relative roles of state, business sector, and academia. Successful features of learning organizations should be emulated in other public agencies, taking account of context, capabilities, competences and constraints, by creating missionoriented networks and partnerships. The missions chosen should reflect best practice. They should be feasible, draw on existing public and Page 36

37 Work with agencies & Revenue to develop greater suite of supports for companies investing in R&D in Ireland Develop specific actions to encourage greater commercialization of research Address the cultural disconnect between industry and academia Lobby Commission to ensure that there is greater access to EU Framework funding private resources, be amenable to existing policy instruments, and command broad and continuous political support. Missions should create a long-term state agenda for innovation policies, address a societal demand or need, and draw on the high potential of the Brazilian science and technology system to develop innovations. Sources: 1. Mazzucato, Mariana, and Caetano Penna. "The Brazilian innovation system: a mission-oriented policy proposal." (2016). 2. Digital Agenda 2020 for Estonia, Ministry of Economic Affairs and Communications 3. Ireland ICT vision document Page 37

38 Annexure VI: Detailed Government departmental expenditure in ICT Demand No Department Description Budget (Rs. In Lakhs) 03 Finance Advances for Purchase of Computers DPAR E-Governance 18, Home & Transport Issue of Computerised & Laminated P.V.C. Driving Licence Cards 300 Wireless and Computers 2,552 Computer Infrastructure - CCI Project 100 Hardware/Software Maintenance & Connectivity in Police Department Law NA NA 28 Parliamentary Affairs and Legislation NA NA 29 Debt Servicing NA NA 12 Information, Tourism and Youth Services Information and Publicity 20,760 Capital Outlay on Information & Publicity 7,539 Information Centres 92 Press Information Services Education Gnana Sangama- Computer Literacy 20, Health and Family Welfare Computer Literacy Awareness 10,000 Health Information Help Line 1,181 Health -Information, Education and Communication (IEC) 50 Implementation of E-Hospital Software at KC General, Sanjay Gandhi Trauma Care Centre & Jayangar General Hospital 5 25 Kannada and Culture NA NA 01 Agriculture & Horticulture NA NA 02 Animal Husbandry and Fisheries NA NA 08 Forest, Ecology & Environment Computerisation of Forest Department 264 Page 38

39 09 Co-operation Technology and Human Resources Upgradation Fund Rural Development & Panchayat Raj RDPR Computerisation 1, Housing NA NA 19 Urban Development NA NA 10 Social Welfare Minority Nodal Centre-District and Taluk Information Centre, Maintenance and Infrastructure 1, Women and Child Development NA NA 13 Food and Civil Supplies IT Initiative for Public Distribution System 2, Revenue Computerisation of Land Records and Revenue Offices Modernization 1,000 Indexing, Cataloging, Pre List Preparation & Scanning of Land Records 1 e-governance Initiative Fund 1 CPS- Digital India-Microfilming of Permanent Records Labour Assistance to Institutions for Technology Training 16, Infrastructure NA NA 15 Information Technology Under various heads 29, Commerce & Industries NA NA 26 Planning, Statistics and Science & Technology NA NA 20 Public Works NA NA 21 Water Resources NA NA 24 Energy NA NA Total 136,109 Page 39

40 Annexure VII: Illustration of IT Adoption in Forward Linkage Sectors Sector Examples of Adoption of Information Technology Urban Waste Management Banyan Nation: The Telangana government, in association with waste management start-up called Banyan Nation, has signed a memorandum of understanding (MoU) to deploy technology across different municipalities and help in waste management. Banyan Nation has developed a zero-waste platform to automate urban recycling operations as part of the Smart Cities Mission. Its first pilot project, currently in beta stage in Warangal district, deploys on-field bin sensors, GPS truck routers, landfill management toolkits and back-end visualisation and analytic engines to monitor and synchronise waste management. Source: Google Toilet Locator: To locate nearest public toilet in Delhi NCR. Ministry of Urban Development (MoUD) partnered with Google to provide location of Toilets on Google Map platform and also has collated community and public toilet data in 5 cities of NCR. Source: Transport Health Agriculture Fishery Forestry Urban Transport Intelligent Transport System (ITS): The Karnataka State Road Transport Corporation has implemented ITS in the City of Mysore for vehicle tracking, providing Estimated Time of Arrivals of fleet at different locations and displaying the same, optimizing fleet and crew, monitoring in-vehicle incidences for security and safety; improving road congestion and bottlenecks. The ITS consists of Vehicle Mounted Unit (VMU) in each bus with capacity to track vehicle location real-time and communicating the same to the servers; advanced algorithms for computing ETA at different locations; MyHealthRecord: MyHealthRecord is a free of cost internet based utility setup by Government of India for the citizens of India to create and manage their health information like prescription, lab test report, medical images, wellness parameters etc. Ministry of Health and Family Welfare jointly with Ministry of Electronics and IT, Gov. of India has developed a Personal Health Record Management System for citizens of India. Source: National Agriculture Market (NAM): NAM is envisaged as a pan-india electronic trading portal which seeks to network the existing Agricultural Product Market Committee (APMC) and other market yards to create a unified national market for agricultural commodities. NAM is a virtual market but it has a physical market (mandi) at the back end. The NAM electronic trading platform has been created with an investment by the Government of India (through the Ministry of Agriculture & Farmers Welfare). It offers a plug-in to any market yard existing in a State (whether regulated or private). The special software developed for NAM is available to each mandi which agrees to join the national network free of cost with necessary customization to conform to the regulations of each State Mandi Act. Source: mkrishi Fisheries: An app under the aegis of the Central Marine Fisheries Research Institute (CMFRI) has been developed to aid fishermen to increase their catch and reduce the cost of operations. It is a mobile advisory service providing information related to the sea, with the app making fishing activities less expensive and environment friendly. It has been developed by the Mumbai Research Centre of the CMFRI and materialised by Indian National Centre for Ocean Information Services (INCOIS) and the Tata Consultancy Service (TCS) under the National Agriculture Innovation Project (NAIP). Source: Aranya: A Spatial Decision Support System for Forest Management. A module based SDSS named 'Aranya' has been developed using open source technology (mainly QGIS) for forest department Bodoland Territorial Areas District (BTAD), Assam, which facilitates the decision making in different domains of forestry, including protection, monitoring, management, research and planning, where each module broadly correspond to administrative working section of the forest departments in India, such as Territorial, Working Plan, Biodiversity, Wildlife, Research, Carbon calculator etc. It also has provision to carry out carbon pool inventory and land allocation planning for rehabilitation. Source: Hyderabad Traffic Integrated Management System (H-TRIMS): The Hyderabad Traffic Police in association with the Greater Hyderabad Municipal Corporation (GHMC) launched H-TRIMS. The project provides signaling service round the clock at 221 junctions and is remotely managed from the Traffic Control Centre. The project Page 40

41 features include 221 signals enabled with virtual loop cameras for Adaptive Traffic Control and synchronized signals. Source: Textiles Law and Order Excise E Dhaga: National Handloom Development Corporation Ltd (NHDC) has developed a mobile app 'E Dhaga' for the benefit of handloom weavers. The app is useful for handloom weavers to transact business anytime, anywhere and they can send their indents and payments online through this app. The weavers can also access the status of the shipment of the dispatched material, thereby, enhancing transparency. Source: CMAPS: The Crime Mapping, Analytics and Predictive System (CMAPS) is being operationalized by Delhi Police in partnership with ISRO for effective use of space technology- based tools for ensuring internal security. The system would help in crime control, law and order and security management through analysis of relevant data and patterns, leading to the optimization of available resources. The software s statistical models and algorithms help the police understand where the next crime is likely to occur. The system will be complete with police officials being equipped with Personal Digital Assistant (PDA) devices connected to a central processor, which stores records of more than two lakh criminals. The system will enable real time access to vital information at the crime scene itself so the officials do not have to go back to police stations for filing reports. Source: Excise Supply Chain Information Management System (ESCIMS): The Delhi government s Department of Excise, Entertainment, and Luxury Tax, which regulates and controls the manufacture and trade of liquor and narcotics, faced a challenging mandate: to make the alcohol supply chain watertight. TCS designed the Excise Supply Chain Information Management System (ESCIMS) that uses high-precision 2D barcodes to uniquely tag and track all stock units across the supply chain in real-time. Source: Page 41

42 Annexure VIII: I: Small Business Set Aside: A U.S. Government Contracting Programme Introduction : Small business set-asides are a powerful tool for helping small businesses compete for and win federal contracts. Every year, the federal government purchases approximately $400 billion in goods and services from the private sector. When market research concludes that small businesses are available and able to perform the work or provide the products being procured by the government, those opportunities are set-aside exclusively for small business concerns. Prime Contract Goals: The Federal government has specified annual prime contracting goals for designated small businesses. The current, governmentwide procurement goal stipulates that at least 23% of all federal government contracting dollars should be awarded to small businesses. In addition, targeted sub-goals are established for the following small business categories: Women Owned Small Business 5% Small Disadvantaged Business 5% Service Disabled Veteran Owned Small Business 3% HUBZone (Historically Underutilized Business Zones) 3% How it works (Based on Contract Value) Contract Value Guidelines $3,500 - $150,000 Every federal government purchase is required to be automatically and exclusively setaside for small businesses. There must be at least two or more (Rule of Two) responsible small business concerns that are competitive in terms of market prices, quality, and delivery for an automatic setaside to occur. $150,000+ Set aside to small businesses (Similar to $3,500 - $150,000 contract value). $700,000 or $1.5M for Construction Contracts opportunities awarded to Other-than-Small-Businesses (OTSBs), must have small business subcontracting plans to the extent there are subcontracting opportunities. A small business subcontracting plan establishes subcontracting goals for small businesses, small disadvantaged businesses, HUBZone, veteran-owned, service-disabled veteran-owned and women-owned small businesses. Page 42

43 Karnataka Vision 2025: BT Sector Inputs from Dr. H. S. Subramanya Dr. Gayatri Saberwal of the Institute of Bioinformatics and Applied Biotechnology (IBAB) 1/38

44 Table of Contents Sector Vision Document (Indicative) i. List of Figures... 3 ii. List of Tables... 3 iii. List of Abbreviations Executive Summary Overview of the Biotech Sector in Karnataka Current state of Biotech sector in Karnataka Institutional framework Benchmarking Karnataka s Biotech sector with other states Global benchmarks in the sector Strategic Analysis of the Biotech sector in Karnataka Growth drivers for the sector Progress of ongoing GoK schemes and proposed interventions Gap analysis Good practices and emerging trends in the sector Insights from stakeholder consultations Vision 2025 for the Biotech Sector in Karnataka Vision statement for the Biotech sector in Karnataka Key goals and targets for Key strategic interventions Implementation roadmap (3, 5 and 7 years) Role of key stakeholders and partnerships Methodology References Annexures /38

45 i. List of Figures Figure 1. The market break up by revenue of the different segment of this industry in India in Figure 2. The state wise share of approved biotech projects in India, in Figure 3. The number of biotech startups in India over the years. Figure 4: The state wise distribution of biotech startups Figure 5: The broad focus areas of biotech start ups Figure 6: The district wise distribution of biotech start ups in Karnataka Figure 7: The market size for biotechnology products and services in India Figure 8: The market break up by revenues for biotechnology products and services in India Figure 9: Karnataka is home to the largest number of biotech companies in India Figure 10. Expenditure by four southern state governments on R&D Figure 11: The top 5 countries with highest % and highest absolute amount invested in R&D. ii. List of Tables 1. Top 5 countries, with highest % of GDP invested 2. Implementation roadmap iii. List of Abbreviations AZ AstraZeneca B4 Boston Bangalore Biosciences Beginnings BBC Bangalore Bioinnovation Centre BIG Biotechnology Ignition Grant Scheme BIRAC Biotechnology Industrial Research Assistance Council BiSEP Biotechnology Skill Enhancement Programme BMCRI Bangalore Medical College and Research Institute BT Biotechnology BTFS Biotechnology Finishing School C CAMP Centre for Cellular and Molecular Platforms CFTRI Central Food Technological Research Institute CHG Centre for Human Genetics DBT Department of Biotechnology GoI Government of India GoK Government of Karnataka HNI High net worth individuals IBAB Institute of Bioinformatics and Applied Biotechnology IISc Indian Institute of Science InStem Institute for Stem Cell Biology and Regenerative Medicine IABT Institute of Agriculture Biotechnology IoB Institute of Bioinformatics IT Information Technology JNCASR Jawaharlal Nehru Centre for Advanced Scientific Research KMIO Kidwai Memorial Institute of Oncology NSDC National Skill Development Council NAIN New Age Incubator Network NCBS National Centre for Biological Sciences NIMHANS National Institute of Mental Health and Neurosciences R&D Research and Development RGUHS Rajiv Gandhi University of Health Sciences 3/38

46 S&T St John's TDU UAS Science and Technology St. John's Medical College Trans Disciplinary University University of Agricultural Sciences 1. Executive summary The Vision Statement for the biotechnology sector is as follows: Biotech products, processes and services will contribute to a bioeconomy of USD 50 billion in the State of Karnataka, rising from the USD 6.5 billion in In order to achieve Vision2025, the following key outcomes need to be achieved by 2025: 1. (a) Increase the number of start ups in this sector from 250 to 500 and improve their chances of survival; and (b) Double the number of incubators, particularly new ones in new georgraphical locations. 2. Academic industrial linkages to power 20% of the growth of the industry. 3. Create 25,000 additional well trained manpower, including in emerging and inter disciplinary areas, to satisfy this knowledge industry's evolving needs. 4. Karnataka to lead the nation and enhance the investment to 3% of its GDP in R&D, as advanced nations do, by % of the state's GDP from this sector should come from districts other than Bangalore. 6. Government (a) to match private investment in IP based BT firms for 7 years, and to provide special funding for firms with products/solutions that have large social impact. (b) Government to fund and otherwise support inventions with potential for large social impact. 7. To make Karnataka the leading state with data derived policy making. The strategic interventions required to achieve these outcomes are: 1 (a) To match the square foot area of high tech incubation in the state with bare bones incubation space. (b) To be the first state to offer virtual incubation to support start ups with mentoring, linkages and academia industry collaboration. (c) To reserve 10% of procurement of goods/services/solutions in departments of the GoK from companies started within the state within the past 10 years. 2 (a) GoK to catalyze 50 academic industry projects (b) Each year, to offer travel and stay fellowships to 10 top notch scientists who bridge academia industry to come from the top bio innovator nations to Karnataka for a short time. (c) To strengthen technology transfer from academia to start ups. 3 (a) To train 25,000 manpower. (b) A certification mechanism to assess and certify those who take courses in niche areas of specialization. (c) To create tinkering labs for motivated students in the bare bones incubators. 4 (a) To provide tax credits or other benefits to HNIs that invest in academic partnerships, start ups or incubators. (b) GoK to provide 50% matching funds raised by (i) academia for applied projects or (ii) incubators, from any source other than GoI or GoK. 5 (a) The government shall provide tax concession or other infrastructure incentives to firms in the sector if they set up in non Bangalore districts of the state. Especially for larger 'anchor firms' that would create a cluster effect. (b) The existing strengths of particular districts, such as coastal 4/38

47 resources for some, medicinal plant strengths of some, agricultural economy for some etc. should be leveraged. 6. (a) Government to match private investment in IP based BT firms for 7 years. (b) Government to fund and otherwise support inventions with potential for large social impact. 7. Support policy research that would provide a basis for future scientific and industrial policies. 2. Overview of the biotech sector in Karnataka 2.1 Current state of biotech sector in Karnataka Listed below are the important sub sectors of the biotech industry. Almost each area has a direct impact on humans, animals, crops and/or the environment*. Agri biotechnology, including bio fertilizers, bio pesticides and bio insecticides Big Data Analytics and Bioinformatics Bio manufacturing Diagnostics Drug discovery and development Environmental biotechnology Food, feed and nutraceuticals Industrial biotechnology Marine biotechnology Medical devices Omics Pharma and healthcare Stem cell and regenerative medicine Synthetic biology * This is an evolving field, and a detailed breakup of the progress of each of these sub sectors is unavailable either for Karnataka or nationally. 2.2 Institutional framework The following departments, offices, think tanks and policies play important roles in the growth of the biotech sector in the state: Department of IT, BT and S&T Karnataka Biotechnology and Information Technology Services (KBITS) Vision Group on Biotechnology Government of Karnataka's Biotech Policy, 2017 (Earlier, Biotechnology Policies I and II in 2001 and 2009) Start Up Karnataka Initiative Grand Challenges Karnataka K Bio Venture fund the Karnataka Guarantee of Services to Citizens Act (SAKALA Act) an ebiz platform through Karnataka Udyog Mitra (KUM) E Udyami 5/38

48 the Biotechnology Industry Research Assistance Council (BIRAC) the Atal Innovation Mission (AIM) the Startup India' campaign The Vision Group on Biotechnology, an Advisory Body to the Chief Minister of Karnataka, was established in the year It has played a crucial role in various initiatives taken in the state. The Department of IT was renamed the Department of IT and BT in 2001, and biotechnology initiatives were brought under the ambit of this department. The Department has brought out successive biotech policies for the state, the Millennium Biotech Policy in 2001 and Millennium Biotech Policy II in 2009 and the new Biotech Policy that has been released in November Amongst all the states, the Government of Karnataka has been a pioneer in rolling out schemes such as Idea2PoC, StartUp Fund of Funds, Elevate100, Grand Challenges and the K Bio Venture fund. The Karnataka Biotechnology and Information Technology Services (KBITS) plays a key role in implementing the policies of the Department. Aside from biotech specific initiatives, more general such as the Karnataka Guarantee of Services to Citizens Act (SAKALA Act), an ebiz platform through Karnataka Udyog Mitra (KUM) and E Udyami help create a more conducive environment for business in the state. Aside from the policies of Karnataka, those of the Government of India have also played an important role in nurturing the sector all over the country, and especially in Karnataka. For the biotech sector specifically, the Biotechnology Industry Research Assistance Council (BIRAC) has numerous schemes to help entrepreneurs and academics with entrepeneurial ambitions. These include BIG, BIPP, SBIRI and Sparsh ( Aside from biotech specific initiatives, policies to support entrepreneurship such as 'Startup India' campaign of the Department of Industrial Policy and Promotion ( the Atal Innovation Mission (AIM) ( innovation mission aim) of the NITI Aayog (Report of the Expert Committee on Innovation and Entrepreneurship August 2015, NITI Aayog, New Delhi, 2015), that includes support for tinkering labs, for incubation centers and to scale up established incubators. 2.3 Benchmarking Karnataka s biotech sector with other states India's bio-economy achieved $35 billion in Biopharma accounts for 64% of the revenues, and is the largest segment. The other major segments are bio-services, bioagri, bio-industrial and bio-informatics with 18%, 14%, 3% and 1% share respectively. It is expected that the biotech industry will grow at 20% a year to reach $100 billion by 2025 ( Specific examples of these segments include ( sector reports november2016): The country's vaccine sector is particularly notable, with WHO procuring vaccines in bulk from the country. The innovative Rotavac vaccine, for rotavirus induced diarrhoea, has been developed and rolled out in India. India's strong generics industry has moved into the bio similar space, and several biosimilars have been developed locally, and have reached the local and foreign, regulated markets. Indian and foreign medical device/diagnstics' firms have raised funding in India and have begun 6/38

49 manufacturing and marketing activities. Personalized medicine, as through genomics, is also picking up and commercialization of local knowledge based services has begun. In the area of agri biotch, almost 11 million hectares are under GM cotton. 95% of the cotton grown in India is of the GM varieties ( business/india has 4th largest area under gm crops/article ece). Figure 1. The market break-up by revenue of the different segment of this industry in India in Source: sector reports november2016 The Government of India has announced various incentives to fuel this growth, and some of these are as follows ( Certain customs' duty exemptions for specific goods meant for R&D R&D expenditure to receive 150% weighted tax deduction Patented products to receive a 3-year waiver of excise duty. In-house R&D expenditure to receive a 100% rebate. Particular benefits for joint R&D projects, and A new venture capital fund for SMEs in this sector Karnataka is ahead of all other states in the country. This is evident from basic and translational research, in start ups, and in larger companies. In terms of basic and translational research, the largest amount of funding from the Government of India's Department of Biotechnology has been for projects in Karnataka. Figure 2. The state wise share of approved biotech projects in India, in /38

50 Source: Biotechnology, India Equity Foundation, June 2017, quoting figures from the Department of Biotechnology, Government of India In terms of industrial development, India s biotech industry is estimated to increase from USD 7 billion in FY15 to USD100 billion by FY25. (Biotechnology, India Brand Equity Foundation, June 2017) There has been a huge increase in the number of biotech start ups in India in recent years, as enumerated in the graph below. Figure 3. The number of biotech startups in India over the years. Source: Traxcn database, October 2017 The state wise distribution shows that Karnataka has a clear lead over other states in the country Figure 4: The state wise distribution of biotech startups 8/38

51 Source: Traxcn database, October 2017 Although Biotech has many sub sectors, it is seen that so far the maximum number of start ups are in the platforms and services segment. Figure 5: The broad focus areas of biotech start ups 9/38

52 Source: Traxcn database, October 2017 Within Karnataka, the biotech start ups are overwhelmingly located in Bangalore. Figure 6: The district wise distribution of biotech start ups in Karnataka Source: Traxcn database, October 2017 Figure 7: The market size for biotechnology products and services in India Source: india.aspx Figure 8: The market break up by revenues for biotechnology products and services in India 10/38

53 Source: india/infographic Karnataka hosts many biotech multinations, a large number of domestic biotech firms and a very large number of startups in this sector. In addition, there are many other companies that support the firms in this sector (Karnataka, the biotech hub of Asia, 2014). Figure 9: Karnataka is home to the largest number of biotech companies in India R&D expenditure in South India is hightest in Karnataka (Karnataka, the biotech hub of Asia, 2014) Figure 10. Expenditure by four southern state governments on R&D 11/38

54 2.4 Global benchmarks in the sector (SDGs/Other indices) The growth of the biotech sector in Karnataka needs to be placed in the global context. The global biotech market has shown double digit growth in recent years (BiotechSpain, dated: , It is projected to be worth USD billion by 2025 ( release/global biotechnology market) Biotechnology has many sub sectors. We give here a few examples of the global outlook for a few of these (Deloitte 2017 global life sciences outlook): Original biologic drugs Increasingly, companies are focussing on biologic drugs rather than small molecules. From 2010 to 2016, this segment grew at a CAGR of almost 4%, and it is expected to reach almost 315 billion by In 2015, biologics comprised 7 of the top 10 drugs in terms of global sales. The drugs target diseases such as cardiovascular disease, diabetes, arthritis and multiple sclerosis. Biosimilars 12/38

55 Close to 700 biosimilars have been approved and they will steal market share from the original drugs. Indian companies have had success in registering their biosimilars in foreign markets. Medical devices (including diagnostics) This segment is expected to grow at CAGR of over 5% from 2016 to The increased prevalence of chronic diseases, including amongst older patients, is leading to enhanced in vitro diagnostic testing. There is also increased preference for minimally invasive procedures, and more sophisticated diagnostic imaging and accessories. The increased use of devices with embedded sensors will help the growth of personalized medicine. 3 Strategic Analysis of the biotech sector in Karnataka 3.1 Growth drivers for the sector (strengths, opportunities and enablers) The following strengths and enablers will form the base for the future growth of the sector in Karnataka (partially based on 'Mapping Regional Innovation Ecosystems: A study of four life sciences clusters in southern India. A report from the BIRAC Regional Innovation Centre (BRIC) at IKP Knowledge Park, Hyderabad, October 2016'): 1. Highest quality academic research in the country, eg. IISc, NCBS, JNCASR (in Bangalore), UAS (Dharwad), and CFTRI (Mysore). 2. High quality research oriented hospitals eg. NIMHANS, Kidwai Institute of Medical Oncology, St John's Medical College (in Bangalore), Kasturba Gandhi Medical College (Manipal), KLE University (Belgaum). 3. Highest quality skilled manpower, suitable for this industry (54% of the country s biotech workforce) 4. High end incubation facilities in different parts of the state 5. Biggest start up ecosystem, with 250 start ups companies (60% of the biotech companies in India) 6. Large, anchor companies in the biotech space such as Biocon, GSK, GE, Siemens, Philips, 3M, Novozymes, Strand Life Sciences (35% of the total revenue generated by the Indian biotechnology industry as of To be noted is that it is the large number of start ups that has increased the share of the country's biotech companies in the state. The revenue is therefore a smaller fraction of the national revenue.) 7. Initiatives of the Government of Karnataka, eg. Idea2PoC, StartUp Fund of Funds, Elevate100, Grand Challenges 8. Initiatives of the Government of India, eg. BIG, BIPP, SBIRI, Sparsh, AIM. Aside from the existing strengths and enablers, the following opportunities need to be leveraged to support future growth of the sector in the state: 1. Translational research activities have been initiated in academia 2. Inter sectoral collaborations such as Bio IT and nano bio exist and need to be strengthened 3. International linkages with other knowledge centres exist and need to be strengthened. Eg the B4 initiative and the Bangalore San Francisco partnership. 13/38

56 4. Development of clusters involving excellent academic institutes, start ups and larger biotech companies has started. eg. Bangalore Lifescience Biocluster 5. Policy research to support decision making in this sector has been initiated and is having impact. 3.2 Progress of ongoing GoK schemes and proposed interventions Realizing the potential of biotechnology to impact so very many facets of existence, GoK has been the most pro active state in terms of its various initiatives to promote this sector. These have been programmes to develop industry ready manpower, to nurture R&D that has translational potential for translation, to assist entrepreneurs, to simplify administrative procedures and so on. Karnataka was the first State to bring out a Biotech policy, the Millennium Biotech Policy in This was followed by the Millennium Biotech Policy II in 2009 and the new Biotech Policy that has been released in To summarize the various initiatives (Government of Karnataka, Biotechnology Policy, , 2017): Industry ready manpower: Starting in 2001, GoK's Department of IT, BT and S&T has been supporting IBAB, and Institute of Agriculture Biotechnology (IABT). Subsequently, in collaboration with DBT, GoI, it supported several colleges to host the BTFS programmes from onwards. This programme has recently been renamed BiSEP, and has been aligned with the National Skill Development Council's (NSDC) activities. These institutions have graduated over 1000 students from their programmes, and most students have been placed in industry. Entrepreneurs: GoK has set up a state of the art incubation centre, the Bangalore Bioinnovation Centre (BBC). DBT of GoI has funded the outstanding equipment facilities. GoK has also supported incubation centres in Mysuru in the area of food technologies and in Dharwad, in the area of agriculture. Similar incubation centres in Mangaluru in the area of aqua marine biotechnology, and Bidar in the area of animal biotechnology are being set up. Aside from incubation space, GoK has supported both the Idea2PoC scheme, where a start up may receive upto Rs. 50 lakhs for upto 2 years of work. Many biotech firms have received this support. The Elevate100 programme, that has sought to nurture entrepreneurial talent across the state, has also supported several biotech start ups. Most importantly, GoK has partnered financial institutions, to establish a Rs. 50 crore fund, KITVEN Fund III (Biotechnology), to support young enterprises in this sector. R&D: In a forward looking move, GoK has, for several years, supported a high end genomics facility, the Bio IT centre at IBAB. More recently it has set up a Synthetic Biology centre, also at IBAB. It is planned to develop a Centre for Advanced Genome Bioinformatics as a joint effort of IBAB and CHG to host genome databases for endangered species, patients with rare diseases etc. The Centre for Biotechnology was also been set up at the University of Horticultural Sciences (UHS), Bagalkot in Other steps: Other crucial steps taken by GoK to assist this sector include general fiscal incentives such as rebates on stamp duty and the exemption of electricity duty, industrial power tariff etc. There are subsidies for investment promotion, for effluent treatment plants etc. There is also financial support for certain certifications and patent registrations. gaps are matched, point by point, to the key outcomes listed above.) The brief summary above captures some of the important steps taken by GoK to catalyze and support this sector. 14/38

57 3.3 Gap analysis In order to achieve the above mentioned outcomes, the following gaps need to be addressed. (These gaps are matched, point by point, to the key outcomes listed above.) 1. a. Current incubation facilities are rigid and small. This does not support the scale up and transition of startups as they grow. b. A gap in mentoring start ups. The available facilities are largely for infrastructure, not for mentoring and establishing connectivities. 2. Academia industry linkages are poor in number and ambition, and do not contribute significantly to the state's GDP yet. 3. Industry ready manpower is in short supply, especially in emerging areas. 4. Adequate investment necessary for achieving significant growth is lacking. 5. Segment specific development of the biotech industry in different parts of the state is lacking. 6. There is lack of appreciation of IP by local Venture Capitalists. 7. Today it is not even known how many practising doctors there are in different specialities in the country. It is difficult to come up with nuanced policies without good figures for facts such as these. 3.4 Good practices and emerging trends in the sector Karnataka is host to both established successes and nascent ones in this industry, as illustrated below. (a) Biocon, the largest biotech company in the state, is an excellent case study of what has been achieved in the State already. Biocon was incorporated in Bangalore in In 2004, it went in for an IPO, the first biotech company in India to do so. Its recent history includes the following: It has become one of the world's largest producers of statins and immunosuppresants. It also has a diabetes franchise, and in 2011, launched INSUPen, a reusable insulin injection. In 2015, Biocon had a market cap of $1.5 billion. In the same year it launched clinical trials for an oral insulin in the US, it started co development of sirna based therapeutics and it partnered to develop an immunotherapy for cancer. In 2016, its biosimilar insulin glargine was approved in Japan, the third largest market in the world after the US and Europe (Biotechnology, India Equity Foundation, June 2017). In November 2017, Biocon was listed as the sixth largest biotech company in the world (M Francisco, Third quarter biotech job picture. Nature Biotechnology 35, 1111, 2017) Two other case studies of well performing start ups in Bangalore are provided below: (b) OncoStem Diagnostics is a home grown start up. Dr. Manjiri Bakre did her PhD at the Indian Institute of Science, and followed this up with a few years abroad. The story of her company so far 15/38

58 is an exciting demonstration of the journey of a knowledge based company in Karnataka today. The company incorporated in Although it is a non trivial exercise to work with hospitals in India, she has succeeded in doing so over the last several years. Aside from Indian hospitals, she has also accessed samples from US hospitals. She has used hundreds of patient tissue samples, with strong statistical backing, to validate a test that is meant to identify whether or not patients with breast cancer need chemotherapy. A negative finding would spare the patient the expense and the rigours of cancer therapy. Within 5 years of registration of the company, the product was launched in the market. One year later, 170 tests have been sold, the product has been CE marked and, most importantly, a second round of funding has been closed. The journey of OncoStem Diagnostics demonstrates the potential of knowledge based start ups in Karnataka today. Critical to its success were: The early availability of investors. The ability to access tissue samples in hospitals. The ability to attract talent, especially higher end talent. Each of these achievements was non trivial. (c) StringBio is attacking a problem of huge global concern: how to sequester methane in productive ways so as to reduce global warming. The company was incorporated in 2013, in Bangalore. The founder, Dr. Ezhil Subbian, returned after several years in the US, and one of her early challenges was to find incubation space. This was a challenge even as late as She was provided lab space at IBAB, and today she has space in both IBAB and BBC. Her team created IP assets as early as Over the last few years StringBio has won several national competitions, including the San Francisco Bangalore Cross Border Entrepreneurship Grant from the Government of Karnataka, BIG, Sparsh and SBIRI grants from BIRAC, and the Best Industrial Biotech Startup in India for 2016 by ABLE. In mid 2017, StringBio was the winner of the Future Food Asia Award in Singapore as the most promising Food Ag Tech start up in the Asia Pacific Region and in October 2017 it was the winner of 'Hello Tomorrow global startup challenge in Food/Ag category' in Paris. The company is currently scaling up its production for commercialization. The journey of StringBio re emphasizes the potential of knowledge based start ups in Karnataka today. Critical to its success were: The early availability of incubation space Ability to leverage local as well as global talent pool Being able to leverage the high quality infrastructure available at BBC The ability to attract highly skilled manpower Early stage/high risk capital aid from DBT/BIRAC Policies that would help such start ups include: Easier access to risk capital Simpler processes for funding tranche cycles so as not to slow down the growth of startups IP cost subsidies for deep technology startups Availability of high quality, trained manpower. 16/38

59 The sub sectors of diagnostics and industrial biotechnology are just two of several sub sectors that have immense potential. The following emerging areas could be drivers of growth of the biotech industry in the State, for which substantial encouragement and investment in R&D is needed (partially based on Government of Karnataka, Biotechnology Policy, 2017). synthetic biology development of biologics aqua marine biotechnology agri and animal biotechnology medicinal plants and herbals bio manufacturing development of affordable medical devices and diagnostics A recent study (Saberwal, 2016) of 50 biomedical entrepreneurs heading start ups (within 5 years of registration) around the country identified the 57 areas of key work (including overlaps): Diagnostics, including omics based proprietary tests and healthcare solutions (15) Products and services using biologics or for the development of biologics (including cell or stem cell based work) (14) Medical devices (10) Small molecule drug discovery (in one case, nutraceuticals) (6) Chemistry or other drug discovery services (6) Software services or platforms (6) This provides some insight into the current emphasis of biomedical entrepreneurs in the country today. Data on other sub sectors in the country is unavailable. 3.5 Insights from stakeholder consultations The biotech sector received relatively fewer inputs than other sectors. 13 inputs were received from the district workshops for the IT&BT (11) or BT (2) sectors; 5 inputs were received from the district presentations for the IT&BT (4) or BT (1) sectors; and 5 inputs were received from the sectoral workshops for the IT&BT sectors. The most frequent input, repeated several times, was to promote incubation centres. Promoting innovation centres, including in government schools, was also mentioned. Regarding specific sub sectors, one input concerned the Western Ghats, which is home to many medicinal plants. The state could use this to become the top performer in the areas of ayurveda and other pharmaceuticals. Another input concerned the need to encourage bio fertilizer, bio pesticides and bio insecticide manufacturing. There was a call for simpler rules and regulations for those setting up their companies. There is a need for a single window regulatory office, subsidies for women entrepreneurs, specialized export center within the industrial zone, subsidized biotechnology labs and R&D centers for MSMEs, banks, truck terminals, ESI regulations for companies with more than 500 workers 17/38

60 etc. Government should refine industry categorisation in order to encourage garage and household startups. The government should also set up SEZs for start ups and encourage the youth. All district level IT & BT start ups to be provided with adequate capital assistance. Funds raising and VC funding facilities should be provided for entrepreneurs and start ups. Hyper subsidising for industries could be a potential area to be explored especially in rural areas, along with introduction of bank linked subsidies. Government should at the same time, develop geographical balance by building basic infrastructure in district areas to reduce and/or negate the effects of immigration in Bengaluru. Furthermore, new industries sanctions must be stopped at Bangalore and should be directed to districts. The select niche areas in which skill enhancement is required to meet the needs of the industry as a prioritized list will be provided by the sector experts within a period of 2 weeks. The government shall provide incentives for start ups who work on socio tech areas that in general address the needs of public at large; in general low tech bit socially relevant. Each of these valuable inputs has been included in the strategic interventions proposed in this report. 4. Vision 2025 for the biotech sector in Karnataka 4.1 Vision statement for the biotech sector in Karnataka Biotech products, processes and services will contribute to a bioeconomy of USD 50 billion in the State of Karnataka, rising from the USD 6.5 billion in Although the target appears steep, there has been a substantial effort in the last few years to build momentum in this sector via start up companies through policy initiatives, and to build a suitable ecosystem for novel product development. A good example is the first ever FDA approved biosimilar Herceptin, brought out by Biocon in Bangalore. We believe these various efforts will start bearing fruit from now onwards. Although it is a stretch goal, with the recommended action and suitable support it should be achievable. 4.2 Key goals and targets for 2025 In order to achieve Vision2025, the following outcomes need to be achieved: 1. a. Increase the number of start ups in this sector from 250 to 500 and improve their chances of survival. b. Double the number of incubators, particularly new ones in new georgraphical locations. Through the various schemes of the Government of India and the Government of Karnataka, start ups are receiving unprecendented financial and other support. On their part, they are investing enormous energy in creating successful firms. It is important to support their efforts in as many ways as possible. This includes the many types of 'soft' support, as through virtual incubation. 18/38

61 2. Academic industrial linkages to power 20% of the growth of the industry. Globally, the biotech sector is an R&D intense one that feeds off academic discoveries. In India so far, academia has largely provided the trained manpower for industry, and not so much the discoveries on which products can be based. If the country is to go up the value chain in this industry, then it is essential that academia industry linkages be strengthened. More discoveries in academia need to be taken forward by industry. For this, we need tecnology transfer offices. Every university in the US (the Massachussettes Institute of Technnology, Harvard University, Stanford University etc.) and in the UK (Oxford University, the University of Cambridge etc.) have such offices, that are meant to help commercialize discoveries in the academic labs. Thus, for instance, the start up ecosystem in Boston consists of a strong academic hub, surrounded by companies spun off from academia and other companies drawn to this ecosystem. Although this is still nascent in India, 9 start ups have been created around technologies of the National Chemical Laboratories (CSIR NCL) in Pune, for istance. It is therefore essential to have such offices, that keep track of the science being done in academia, and can link entrepreneurs to those labs. 3. Create 25,000 additional well trained manpower, including in emerging and inter disciplinary areas, to satisfy this knowledge industry's evolving needs. Any targets for growth of this sector require industry ready manpower. The State has been pioneering in its support for this requirement, including the setting up of IBAB and the BTFS programmes. This support needs to be expanded to a much larger scale. 4. Karnataka to lead the nation and enhance the investment in R&D to 3% of its GDP, as advanced nations do, by As a nation, India only invests 0.8% of its GDP in R&D whereas Israel and Korea invest over 4%, although it is recognized that to derive significant economic benefits 3% is necessary (VijayRaghavan, K. and Saberwal, G. 2017). And to be noted is that the ratio of business to government spending in India is miniscule compared to developed nations. Figure 11: The top 5 countries with highest % and highest absolute amount invested in R&D. 19/38

62 Source: and development spending/ 5. 30% of the state's GDP from this sector should come from districts other than Bangalore. To build upon the distinct strengths of each district, it is essential that measures be taken to enhance the industry outside Bangalore. 6. Government (a) to match private investment in IP based BT firms for 7 years, and to provide special funding for firms with products/solutions that have large social impact. (a) It is known that a majority of the start ups in this sector are IP based (Saberwal, 2016). Developing innovative technologies takes significant upfront funds, and there has been a dearth of such funding. Although there is increasing interest by private funders, it is inadequate. If such funding were to be matched by government funding, this would provide a big boost to these innovative companies. (b) Numerous inventions could have large social impact, although they may not attract venture funding. These may be grassroots innovations, or higher tech innovations by urban based innovators. Such inventions may not need a huge amount of funding, and yet may fail to attract the needed amounts. It is preferable to create a separate funding agency to accommodate the various requiremenst of this sector. 7. To make Karnataka the leading state with data derived policy making. 4.3 Key strategic interventions In order to address the above mentioned gaps, and achieve the outcomes listed above, the following strategic interventions are required. (These interventions are matched, point by point, to the gaps listed above.) 1 a) To help retain valuable start ups in the state and enable their further growth, match the square foot area of high tech incubation in the state with bare bones incubation space. According to KBITS of the Department of IT, BT and S&T, there are 250 start ups in the State at present. Let us assume that each occupies 500 sq. ft. of space. For a further 250 start ups, there is need for another 250 x 500. sq ft. of space. In addition, let us assume that 50 start ups grow significantly and need 1000 sq. ft. of additional space each. The total requirement of additional space is (250 start ups x 500 sq. ft) + (50 start ups x 1000 sq. ft.) = 1,75,000 sq. ft. Since Bangalore is the start up capital of the country, 90,000 sq. ft. should come up in Bangalore and 85,000 sq. ft. in other districts of the State. The incubation facilities built in other districts should be spread over 5 locations, with 15,000 sq. ft. each. It will cost Rs. 5,000/ per sq ft to build basic laboratory space, including lab benches. Let the functional 1,75,000 sq. ft. happen over year 1 and year 2, equally. Budget timelines: Rs crore per year for year 1 and year 2. Total budget: Rs crores 20/38

63 b) To be the first state to offer virtual incubation to support start ups with mentoring, linkages and academia industry collaboration. This incubation can work across geographical areas, and is not limited to specific brick and mortar incubation centres. To host the nationally acknowledged best virtual incubator in the country. Need one strong virtual incubator with a state wise mandate. Need to develop virtual incubator infrastructure throughout the state. This should be linked to the bare bones incubators. The incubator will require (a) an experienced, well networked CEO, and a total staff strength of about 10; (b) computational infrastructure including a good server to host software, databases and tools; (c) dedicated space to host the incubator staff and to host meetings. Budget timelines: An initial investment of Rs. 10 crores, and Rs. 2 crores/year in operational costs. Total budget: Rs. 20 crores over 5 years. c) To reserve 10% of procurement of goods/services/solutions in departments of the GoK from companies located within the state, preferably those started within the past 10 years. This will seed market linkages for certain sub sectors. Although public procurement may relate to different sub areas, we simply list the health care segment as an example. The government runs health facilities across the state, and has need for pharmaceutical products, medical devices, consumables etc. For products that meet or exceed the required specifications, procurement could be preferentially reserved for local companies, with particular emphasis on start ups as a source. or incubators. An announcement of such policies to be made in Year 1. Budget: Not required. 2 a) GoK to catalyze 50 academic industry projects Projects for which there is proof of close collaboration or plausible intention to hand off project from academia to industry To offer funding of upto Rs. 1 crore over 3 years for each project. To fund 5, 10, 15, 20 projects over 4 years. Budget timelines: Rs. 5 crores in year 1; Rs. 10 crores in year 2; Rs. 15 crores in year 3 and Rs. 20 crores in year 4. Total budget: Upto Rs. 50 crores. b) Each year, to offer travel and stay fellowships to 10 top notch (a) academic scientists that work with industry or (b) industrial scientists that work with academia to come from the top bio innovator nations to Karnataka for a short time, with a requirement to meet scientists in both academia and industry, and in particular to meet innovator start ups. Budget timelines: To fund 10 people per year for 7 Rs. 5,00,000/person/trip. Total budget: Rs. 3.5 crores c) To strengthen technology transfer from academia to start ups. To identify 10 excellent academic institutes that have start ups nearby. 5 of the institutes should be outside Bangalore Establish technology transfer (TT) offices at each of the institutes. 21/38

64 Provide strong support to develop TT linkages between academia and the start ups. Support should be for establishing the TT offices, for regular meetings, for IP identification and protection, and for the start ups to develop the IP. Financial support should be provided to the start ups that develop the IP from academia, to the tune of about Rs. 25 lakhs each. Budget timelines: Rs. 5 crores should be provided to each of these centres of excellence, 3 in year 1 and 5 in year 2 and 2 in year 3. Total budget: Rs. 50 crores. 3 a) To increase the availability of industry ready manpower. To strengthen existing institutions in this sector such that they can increase their intake substantially, especially in inter disciplinary and emerging areas. If the bioeconomy of the State has to grow from USD 6.5 billion to USD 50 billion by 2025, this is almost a 10 fold increase. The industry currently has 7,500 employees in the state. Since manpower and productivity are not directly linked, it is not necessary to aim for a 10 fold increase in industrial manpower, but at least 25,000 industry ready manpower must be available to fuel the growth of the sector. In order to create industry ready manpower, there is a need to create postgraduate training programmes in different segments of biotech such as cellular and molecular diagnostics, protein expression and scale up, big data biology, synthetic biology, fermentation and bio processing etc. The duration of training can be variable, and include 6 month, 1 year and 2 year courses. The following distribution of trainees could apply: 8,000 students for 6 months; 15,000 students for 1 year and 2,000 students for 2 years. Within each of the 3 duration programmes, students need training in different segments. To train 25,000 students, 500 courses (in upto 500 institutions) need to be offered, with 50 students per course. The 25,000 students should be trained over 5 years. Budget timelines: Rs. 1 lakh/ student for a 6 month course; Rs. 3 lakhs/student for a 1 year course; Rs. 6 lakhs/student for a 2 year course. Initial support for infrastructure of Rs. 1 crore per course. Starting from year 2, 5000 students should be enrolled per year in the same ratio as outlined above for the 3 types of programmes. Total budget: Rs. 500 crore + Rs. 650 crores = Rs. 1,150 crores b) A government recognized certification mechanism in coordination with industry bodies to assess and certify those who take courses in niche areas of specialization (much as DOEACC s programming certification) to validate the knowledge and skills acquired for employment. To roll these out in 20 sub sectors. Budget timelines: Rs. 5 lakh/sub sector, with half of the sub sectors in year 1 and half in year 2. Total budget: Rs. 1 crore c) To tap the creativity of the youth, for the growth of this innovative sector. 22/38

65 To create tinkering labs for motivated students in association with the bare bones incubators. Budget timelines: Rs. 2 crore to set up each tinkering lab, in 5 bare bones incubators around the state, for 25 highly motivated students per lab. Rs. 50 lakhs/lab per year for each of 7 subsequent year. Total budget: Rs crores 4 a) To provide tax credits or other benefits to HNIs who invest in academic partnerships, start ups or incubators. An announcement of such tax credits or other benefits to be made in Year 1. Budget: Not required. b) GoK to provide 50% matching funds raised by (a) academia for applied projects or (b) incubators, from any source other than GoI or GoK. Income (such as from rentals etc) will not be eligible for matching funds. To run this scheme for 5 years. Budget timelines: Rs. 5, 5, 8, 12 and 20 crores will be budgeted for this from years 1 5 respectively. Total budget: Rs. 50 crore 5 a) The government shall provide tax concession or other infrastructure incentives to firms in the sector if they set up in non Bangalore districts of the state. This would especially apply to larger 'anchor firms' that would create a cluster effect. An announcement of such tax concessions or other benefits to be made in Year 1. Budget: Not required. b) The existing strengths of particular districts, such as coastal resources for some, medicinal plant strengths of some, agricultural economy for some etc. should be leveraged. 10 districts to apply for a 'District of excellence' in a particular segment of biotech. The government could then support that district in that area in particular. Basic infrastructure required will vary. The inter sectoral meeting should determine details. Budget timelines: 5 crores per district to seed activities in these sectors. 5 districts in Year 1 and 5 districts in Year 2. Total budget: 50 crores 6. a) Government to match private investment in IP based BT firms for 7 years. An estimated 5% of the 500 start ups will succeed significantly, and attract venture capital investment. The government should match VC funding, up to Rs. 10 crores per firm, from a dedicated fund. Budget timelines: Sanctioning Rs. 10, 20, 40, 80 and 100 crores in years 1 5, respectively. Total budget: Rs. 250 crores b) Government to fund and otherwise support inventions with potential for large social impact. 23/38

66 A certain fraction of the 500 start ups may fall in this category. The government should dedicate a certain percentage of funding from schemes such as Idea2PoC and Elevate100, or to have a specific scheme, to support such start ups. Budget timelines: Sanctioning Rs. 50 lakh/year to 10 start ups for years 1 5, respectively. Total budget: Rs. 25 crores 7. Support policy research that would provide a basis for future scientific and industrial policies. The Department could initiate a scheme for policy research. The scheme could establish calls for proposals in specific areas, or have an open ended scheme where researchers can submit proposals in the area of empirical policy research in particular. Budget timelines: Rs 5 crores/year x 5 years. Total budget: Rs. 25 crores Summary of incentives: We summarize here the incentives listed above amongst the key strategic interventions. 1. To reserve 10% of procurement of goods/services/solutions in departments of the GoK from companies located within the state, preferably those started within the past 10 years. This will seed market linkages for certain sub sectors. 2. To provide tax credits or other benefits to HNIs who invest in academic partnerships, start ups or incubators. 3. The government shall provide tax concession or other infrastructure incentives to firms in the sector if they set up in non Bangalore districts of the state. This would especially apply to larger 'anchor firms' that would create a cluster effect. An announcement of these incentives could be made in Year Implementation roadmap The various interventions mentioned above, their timelines and their budgest are captured in the table below. Goal 1a To help retain valuable start ups in the state and enable their further growth 1b To be the first state to offer virtual Type of Programme Create bare bones laboratory based incubation space. Need one strong virtual Programme Particulars To create 1,75,000 sq. ft. Incubation space. An experienced, well networked 24/38 Budget (in Rs. Crores) Tota l

67 incubation to support incubator with a start ups with state wise mentoring, linkages mandate. and academia industry collaboration. 1c To provide market linkages for local companies, and start ups in particular 2a To catalyze 50 academic industry projects 2b To reserve 10% of procurement of goods/ services/ solutions in departments of the GoK from companies located within the state, preferably those started within the past 10 years. To fund academic projects for which there is proof of close collaboration or plausible intention to hand off project from academia to industry to offer travel and stay fellowships to 10 top notch (a) academic scientists that work with industry or (b) industrial scientists that work with academia to come from the CEO to mentor and network start ups; computational infrastructure including to host software, databases and tools; dedicated space to host the incubator staff and to host meetings. An announcement of such tax credits or other benefits to be made in Year 1 To offer funding of upto Rs. 1 crore over 3 years for each project. To fund 5, 10, 15, 20 projects over 4 years Rs. 5 lakh/person/trip, to cover international travel, local travel and local hospitality /

68 2c To strengthen technology transfer from academia to start ups. 3a To create industry ready manpower 3b To assess those who take courses in niche areas of specialization 3c To tap the creativity top bio innovator nations to Karnataka for a short time, To identify 10 excellent academic institutes that have start ups nearby. Establish technology transfer (TT) offices at each of the institutes. Provide strong support to develop TT linkages between academia and the start ups. To strengthen existing institutions in this sector such that they can increase their intake substantially, especially in inter disciplinary and emerging areas. A government recognized certification mechanism in coordination with industry bodies to assess and certify those who take courses in niche areas of specialization Create tinkering Financial support for establishing the TT offices, for regular meetings, for IP identification and protection, and for the start ups to develop the IP. Financial support should be provided to the start ups that develop the IP from academia, to the tune of about Rs. 25 lakhs each To train 25,000 students as follows: 8,000 students for 6 months; 15,000 students for 1 year and 2,000 students for 2 years To roll out such certification mechansims in 20 sub sectors Initial funding to set /

69 of the youth of the state 4a To enhance funding for activities/projects at the interface of academia and industry 4b Karnataka to lead the nation and enhance the investment to 3% of its GDP in R&D, as advanced nations do, by a 30% of the state's GDP from this sector should come from districts other than Bangalore. 5b 6a Addressing the lack of appreciation of IP by local Venture labs in association with the bare bones incubators To incentivize HNIs who invest in academic partnerships, start ups or incubators. GoK to provide 50% matching funds raised by (a) academia for applied projects or (b) incubators, from any source other than GoI or GoK. The government shall provide tax concession or other infrastructure incentives to firms in the sector if they set up in non Bangalore districts of the state. District of excellence scheme Government to incentivize private up laboratories, and annual grants to run them An announcement of such tax credits or other benefits to be made in Year 1 A gradual ramping up of funding as academia and incubators are more successful in raising funds from elsewhere over time Announcement of suitable concessions or other incentives The existing strengths of particular districts, such as coastal resources for some, medicinal plant strengths of some, agricultural economy for some etc. should be strengthened and built upon. Government to match private investment in IP /

70 Capitalists. 6b Addressing the need for start ups with products with large social impact 7 Policy research to support decision making in this sector investment in BT firms. The government should dedicate a certain percentage of funding from schemes such as Idea2PoC and Elevate100, or to have a specific scheme, to support such start ups. The Department could initiate a scheme for policy research. based BT firms for 7 years. The government should sanction Rs. 50 lakh/year to 10 start ups for years 1 5, respectively. The scheme could establish calls for proposals in specific areas, or have an open ended scheme where researchers can submit proposals in the area of empirical policy research in particular Role of key stakeholders and partnerships (Backward & Forward linkages) The strategic interventions proposed in this document are largely recommendations to the Department of IT, BT and S&T of the Government of Karnataka. The issue of whether the state can move towards allocating 3% of its GDP to R&D (across sectors) is an issue that has to be considered at the highest level in the state. Other than that, there are no specific recommendations for other departments. 5 Methodology The following methodology was adopted to obtain as wide and meaningful a spectrum of inputs as possible for this report. District level workshops: Inputs were received through the district level consultations. The biotech sector probably received slightly less inputs than other sectors, nevertheless all of these were taken into account. Online survey of stake holders: A survey instrument was created to ascertain Subject experts' own knowledge: The authors of this report have many years of experience with this sector from different angles, and have brought their knowledge to bear on it. 28/

71 In person consultations with other subject experts: A range of stake holders were consulted for their inputs. Editorials, white papers and other scholarly publications: Publications and reports from academic and commercial sources were used as relevant. Data from GoK: Officials of KBITS provided their inputs to specific queries 6 References 1. Government of Karnataka, Biotechnology Policy, , Mapping Regional Innovation Ecosystems: A study of four life sciences clusters in southern India. A report from the BIRAC Regional Innovation Centre (BRIC) at IKP Knowledge Park, Hyderabad, October and development spending/ 4. K. VijayRaghavan and G. Saberwal. Bio business in brief: The case for ambitious action in the public sector, Current Science 113, (2017) 5. Report of the Expert Committee on Innovation and Entrepreneurship August 2015, NITI Aayog, New Delhi, innovation mission aim 9. growth expected pick pace/ business/india has 4th largest area under gm crops/article ece sector reports november BiotechSpain, dated: , iid= Deloitte 2017 global life sciences outlook release/global biotechnology market 15. Biotechnology, India Equity Foundation, June Karnataka, the biotech hub of Asia, M. Francisco, Third quarter biotech job picture. Nature Biotechnology 35, 1111, G. Saberwal. India's intellectual property based biomedical start ups. Current Science 110, (2016) 7 Annexures 1. Annexure 1: The list of biotech start ups in Karnataka 2. Annexure 2: The case study of Biocon 3. Annexure 3: The case study of OncoStem Diagnostics 4. Annexure 4: The case study of StringBio Annexure 1: The list of biotech start ups in Karnataka* # Name of Organization. Sector 1 5W Ventures Pvt Ltd Biotech 2 Achira Labs Private Limited Medical Devices 29/38

72 3 Achyutha Enterprises Agriculture 4 Aerobic Biotaxy India Private Limited* Bio Indstrial 5 Affigenix Biosolutions Private Limited BioPharma, BioServices, Bio Industrial 6 Aglabs Agrotech Private Limited Agriculture 7 AgriBasket Soluitons Private Limited Agriculture 8 Aindra System Private Limited Medical Devices 9 AISIRI HEALTH TECHNOLOGIES Pvt Ltd 10 Ajay Herbals 11 Alferm Biotec Private Limited* 12 AlmaNourisher Solutions Pvt.Ltd 13 Ambiente Biotech Private Limited Biotech 14 Ameliorate Biotech Private Limited Biotech 15 AMVICUBE Agriculture 16 Anarghyaa ETech Solutions Pvt Ltd 17 Aprus Bio medical Innovations Private Limited* Medical Devices 18 Arogyamarg healthcare diagnostics private limited 19 Arokare INDIA Pvt Ltd Agriculture 20 ASUJI E DOCTOR PVT LTD 21 Aten Biotherapeutics Private Limited* Biotherapeutics 22 Atrimed Biotech Biotech 23 Audicor Cardiometrics Pvt. Ltd 24 Avanijal Agri Automation Pvt Ltd Agriculture 25 AYUSH IT 26 Azooka Life Sciences LLP Biotech 27 Barrix Agro Sciences* 28 Bemonoid Healthtech Private Limited 29 BendFlex Research and Development Private Limited 30 Bhami Research Lab Biotechnology, Biopharmaceutical Industry, AgriTech 31 BigHaat Agro Pvt Ltd Agriculture 32 BIGSOLV ADVANCED LABS PRIVATE LIMITED 33 Biodesign Innovation Labs 34 Bioinventive Research technologies organisatioon Biotech 35 Biokart India Private Limited BioServices, BioInformatics 30/38

73 36 BIOLOGICAL RESEARCH INNOVATION CENTRE and SOLUTIONS LLP Agriculture 37 BIO LUTIONS ECO TECH INDIA PRIVATE LIMITED Biotech 38 Biomoneta Research Private Limited Medical Devices 39 BIONIC YANTRA PRIVATE LIMITED 40 Blandcode Labs Private Limited 41 Brekkie Foods Private Limited Food & Beverages 42 Bugworks Research India Private Limited Biotech 43 ByTheFarmer Agriculture 44 Caltech Innovations Private Ltd 45 Cardiac Design Labs Private Limited Biotech 46 certum ventures private limited 47 cheermap foods pvt lts Food & Beverages 48 Chikitsak LifeSciences Pvt Ltd 49 Clean Bill of Health Private Limited 50 Cleanergis Biosciences Private Limited Biotech 51 Clinisys Clinical Research* 52 cloud 9 networkz 53 Clovergen Lifesciences Pvt Ltd Biotech 54 Cocogreen Foods LLP Agriculture 55 Coeo Labs Medical Devices 56 Cottonsoil Healthcare Tech Private Limited 57 CQuest BioSolutions Private Limited Biotech 58 Criyagen Crop Care Services LLP Agriculture 59 CYL Health and Fitness Solution Pvt Ltd 60 Denovo Biolabs Private Limited Biotech 61 Df3D Medical Devices 62 DIPONED BIO PRIVATE LIMITED Biotech 63 DocEngage Informatics Pvt Ltd 64 Doctto Online Healthcare Innovation P Ltd 65 Dr. Satya Tapas Medical Devices 66 DrLive Software Pvt Ltd 67 E2E BioTech Private Limited* Bio Indstrial 68 EasyM2M Technologies Pvt Ltd 69 EHE Innovations Private Limited 70 EMPATHY DESIGN LABS PRIVATE LIMITED 71 Essen Shimmer Medical Technologies Pvt. Ltd 31/38

74 72 ethinkcells Software Solutions and Services Private Limited 73 FAMPRO AGRIBUSINESS PRIVATE LIMITED Agriculture 74 Farms2Fork Technologies Pvt. Ltd. Agriculture 75 Fermedicius Labs Food & Beverages 76 FITnBLISS Preventive Healthcare Pvt Ltd 77 Fitness Dugout Health and Fitness Private Limited 78 FLASHMEDIX SERVICES PRIVATE LIMITED 79 Focalway Diagnossist Technologies Pvt Ltd 80 Forus Health Private Limited BioServices 81 Fourth Frontier Technologies Private Limited 82 Freshfusion Juices Private Limited Food & Beverages 83 GALACTIC MEDICAL DATABANK PVT LTD 84 GENESPY Research Service Private limited Biotech 85 Geniron Biolabs Private Limited BioPharma, BioServices 86 Geniron Biolabs Pvt Ltd Biotech 87 Genxfarming Private Limited Agriculture 88 Godel Technology Pvt. Ltd. 89 Green Food Park Limited BioAgri 90 Green Robot Machinery Private Limited Agriculture 91 Greenilai Technologies Private Limited Agriculture 92 Greenopia Technologies LLP Agriculture 93 Hanugen Therapeutics Private Limited Biotech 94 HAPPY FARMER LABS Agriculture 95 Happy Reliable Surgeries Private Limited 96 Health Bot Private Limited 97 Healthelife Ventures LLP 98 HealthMinds Consulting Pvt Ltd 99 Hinfoways Healthcare Pvt.Ltd. 100 Hosachiguru Agritech Pvt ltd Agriculture 101 HUNO RESEARCH AND INNOVATION LAB 102 Idea Bubbles Consulting Services Pvt. Ltd. 103 Inbiosys Consulting Private Limited* 104 Indio Labs Private Limited Medical Devices 105 Indoor Biotechnologies India Private Limited* Other Services 32/38

75 106 INNACCEL TECHNOLOGIES PRIVATE LIMITED 107 Innaumation Medical Devices 108 Innov 4 Sight* Other Services 109 INSPIRON PSYCHOLOGICAL WELL BEING CENTRE PRIVATE LIMITED 110 Intelleza Technologies Pvt. Ltd. 111 Intello Labs Pvt ltd Agriculture 112 InterpretOmics India Pvt Ltd 113 iosynth labs private limited Biotech 114 Irasto Healthcare Private Limited 115 ispagro Robotics Pvt Ltd Agriculture 116 Jana Care solutions Private Limited* Medical Devices 117 Janitri Innovations Private Limited 118 Jayalaxmi Agrotech Pvt Ltd Agriculture 119 Jivabhumi Agritech Private Limited Agriculture 120 Jounetsu Solutions Pvt Ltd 121 JUBELN LIFESCIENCES PRIVATE LIMITED 122 Kaulige Foods Food & Beverages 123 Kinematic foodtech pvt ltd Food & Beverages 124 Kinome Pharma* BioPharma 125 Kisan School Agriculture 126 KNC GROUP Food & Beverages 127 Kolar Organic Farmers Producer Company Limited Agriculture 128 Kreativesolutions Agriculture 129 Kumera Engineering Solutions Pvt Ltd Agriculture 130 KURUVA TECHNOLOGIES LLP Food & Beverages 131 Lab4life Bio Research Private Limited* Other Services 132 Leads Clinical Research And Bio Services Private Limited 133 LEANONME COUNSELLING SERVICES PVT LTD 134 Leucine Rich Bio Private Limited Biotech 135 Liveon Biolabs Private Limited Other Services 136 Lumisoft Technologies Pvt Ltd 137 M/s LOVSOY FOOD PRODUCTS LLP Agriculture 138 M/s Nirnal Water Filter 139 MEDFIX HEALTHCARE PRIVATE LIMITED 33/38

76 140 Medgenome BioInformatics 141 Medilenz Innovations Pvt Ltd 142 Medisense Healthcare Solutions Private Limited 143 MedTourEasy 144 Medyug Technology Pvt Ltd 145 MeghaGen Biosciences Pvt Ltd Biotech 146 Mendonca Medical Biotech Biotech 147 Million Milestones Food & Beverages 148 Mimyk 149 Mitra Biotech BioPharma 150 MOAPSYS TECHNOSOFT PRIVATE LIMITED 151 momtree health tech pvt ltd 152 Mother Diagnostic Systems Private Limited Biotech 153 mycarevault technologies pvt ltd 154 Mynvax Private Limited Biotech 155 Namgru Innovations 156 Nature Biochem Private Limited* BioIndustrial 157 NeoMandi Technologies Pvt. Ltd Agriculture 158 Nesa Medtech Private Limited 159 NETWORK HEALTHCARE GLOBAL LLP 160 NIRAMAI Health Analytix Private Limited 161 NIRUJA NUTRICARE PRIVATE LIMITED 162 NoPo Nanotechnologies India Private Limited Biotech 163 Norwich Clinical Services Private Limited* BioServices 164 Novo Catalyz Scientific Technologies Private Limited* Medical Devices 165 nsmiles India Private Limited 166 Numarga Services Private Limited 167 Nutrea BioAgri 168 NutriPlanet Foods Private Limited Food & Beverages 169 OHealer Healthcare Services Private Limited 170 Oleome Biosolutions Private Limited* BioAgri 171 Olivewear Pvt. Ltd. 172 Omicorn Technologies Pvt. Ltd 173 Omix Research And Diagnostics Laboratories Private Limited* Medical Devices 174 Pandorum Technologies Private Limited* 34/38

77 175 Parentlane 176 Pentavalent Bio Sciences Pvt Ltd BioPharma, BioIndustrial 177 Pillpouch Healthteach Private limited 178 Pluckfresh Agro Solutions Pvt Ltd Agriculture 179 Pradin Technologies Medical Devices 180 Prayagad Private Limited 181 Preksha Ecotech Private Limited* Other Services 182 PROGNOSYS HEALTHCARE (INDIA) PRIVATE LIMITED 183 Pronet Informatix Private Limited BioInformatics, BioServices 184 Prosperita Medi 360 Private Limited 185 PurpleGull Agriculture 186 PurpleGull Services Agriculture 187 QTLomics BioAgri 188 qtlomics technologies pvt ltd Biotech 189 QuickMedico Digital Private Limited 190 Rapid Biopharma Private Limited* 191 Realment Labs Private Limited 192 RENALYX HEALTH SYSTEMS PRIVATE LIMITED 193 RETISENSE TECH INDIA PRIVATE LIMITED 194 ribbn care management services private limited 195 ROAD SIDE EMERGENCY PRIVATE LIMITED 196 Robust Herbals Private Limited* BioPharma 197 RUDHRA SOLAR & AQUA INDIA PVT LTD 198 Saiesh info solutions pvt Ltd 199 Sanohub Technologies Private Limited 200 Sascan Meditech Pvt Ltd 201 Sasya Gentech Private Limited* 202 Satori Health Pvt Ltd. 203 Sattva Medtech 204 SciDogma Research & Scientific Networks (P) Ltd. 205 Scintilla Bio MARC Pvt. Ltd. 206 Sea 6 Energy Private Limited 207 ShanMukha Innovations Pvt. Ltd 208 Shilps Sciences Medical Devices 35/38

78 209 Shirdi Sai Nutraceuticals Private Limited BioIndustrial 210 SHIRDI SAI NUTRACEUTICALS PVT LTD Biotech 211 Shre Shridhareshwara Coconut Products Food & Beverages 212 SHUBRA SOLUTIONS 213 SIAMAF Healthcare Private Limited 214 SkyKrafts Aerospace Pvt Ltd Agriculture 215 SM Plant Production Technologies Pvt Ltd Agriculture 216 Smew Tech Labs Private Limited Food & Beverages 217 SmUrF Space Pvt. Ltd. Agriculture 218 SPECTRAL INSIGHTS PRIVATE LIMITED 219 Spes labs Private Limited 220 Sri Research For Tissue Engineering* BioServices 221 Srisai Healthcare 222 Strides Healthcare Private Limited* BioPharma 223 String Bio Private Limited* Other Services 224 Sumadhva Technologies 225 Syncremedies Healthcare Pvt Ltd 226 Tech Source Solutions Agriculture 227 Techinovative Healthcare Solutions 228 Tejasco Techsoft Pvt Ltd 229 TerraBlue Exploration Technologies Pvt Ltd 230 Terrablue XT Private Limited* Other Services 231 Theramyt Biologics Pvt Ltd BioPharma 232 TMT FITNESS PVT LTD 233 Trioga Labs 234 Turtle Shell Technologies Pvt. Ltd. Biotech 235 uber Diagnostics Pvt Ltd 236 Urbanhealth Technologies Private Limited 237 V2 Exotic India Pvt Ltd Food & Beverages 238 Vertical Farming Technologies Private Limited Agriculture 239 VIPRAGEN BIOSCIENCES PVT LTD Biotech 240 Viravecs Labs LLP Biotech 241 VitaCloud Digital Health Private Limited 242 VNIR biotechnologies Pvt Ltd Biotech 243 Voolab Technologies 244 Vphore Labs Pvt Ltd Biotech 245 Wellth Solutions 246 Yostra Labs Private Limited Medical Devices 36/38

79 247 YouGoTag Technology Solutions Pvt Ltd 248 Your Wellness Expert Private Limited 249 Zrii Technologies 250 Zumutor Biologics Pvt Ltd Biotech *the list of Biotech Start ups registered with the Start up Cell of KBITS, under Biotechnology Annexure 2: The case study of Biocon Annexure 3: The case study of OncoStem Diagnostics 37/38