As part of the push to decentralise the startup ecosystem, the Chief Minister Siddaramaiah, while presenting the Karnataka Budget 2026, proposed establishing incubation facilities for entrepreneurs in Tier-2 and Tier-3 cities such as Hubballi, Kalaburagi, Hoskote and Mysuru. The move is intended to nurture startups beyond the state capital and support local innovation-driven enterprises.
Moreover, the CM proposed ₹20 crore to launch incubation centres for startups. These incubation centres will be established in collaboration with IIM Bengaluru, University of New South Wales, Australia, and the Indian Institute of Science.
In addition, the state plans to set up LEAP labs through the Karnataka State Electronics Development Corporation. The initiative builds on the LEAP (Local Economy Accelerator Programme), a five-year programme launched by the Department of Electronics, IT and Biotechnology with an outlay of ₹1,000 crore to strengthen Karnataka’s regional innovation ecosystem.
The CM also said the state has proposed to the Union government the establishment of a ‘Science City’ near Bengaluru at an estimated cost of ₹233 crore. The proposed facility is expected to promote scientific awareness, innovation and research through interactive science infrastructure and public engagement.
In the skilling sector, Siddaramaiah announced the rollout of the K-QUEST (Karnataka – Quality Upgradation for Employment and Skills Transformation) project over five years with a total outlay of ₹1,386 crore. The programme will be implemented in partnership with the Asian Development Bank.
The K-QUEST project aims to upgrade infrastructure and improve training standards across government-run technical institutions, including Industrial Training Institutes, Karnataka German Technical Training Institutes, KSDA and Junior Technical Schools across the state, with the goal of enhancing employability and aligning skills training with industry needs.
The CM has also proposed establishing modern AI data labs with a grant of ₹10 crore in 50 government colleges in Tier-2 and Tier-3 cities.
The initiative will be implemented in collaboration with the IndiaAI Mission. The aim is to make rural youth employable by providing them with the necessary skills.
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