Karnataka has scripted an extraordinary economic success story by emerging as the state with the highest per capita income in the country for the financial year 2024–25 a landmark achievement that many attribute to the consistent policy push, infrastructure investments, and economic empowerment programmes driven by the Union government over the past decade.
According to the latest data tabled in Parliament by Union Minister of State for Finance Pankaj Chaudhary, Karnataka’s Net State Domestic Product (NSDP) per capita now stands at Rs 2,04,605, more than double its figure of Rs 1.05 lakh per capita in 2014– 15. This reflects an impressive 93.6 per cent growth over the past decade a rate that outpaces the national per capita income growth of 57.6 per cent during the same period. Karnataka’s per capita income also saw a healthy 6.6 per cent year-on-year rise from Rs 1.91 lakh in 2023–24.
This remarkable rise underscores how Karnataka has benefitted from flagship national initiatives that have strengthened its economic fundamentals. Programmes such as Make in India, Startup India, Skill India, Digital India, and PM Gati Shakti have played pivotal roles in transforming the state into a high-value hub for innovation and manufacturing. Karnataka’s economic base, once largely dependent on traditional industries and agriculture, has evolved into a thriving ecosystem for global IT, biotech, fintech, and clean energy companies.
Massive investments in highways, industrial corridors, and logistics have connected Karnataka’s cities and districts like never before. Union government-backed schemes, such as Bharatmala and Sagarmala, have ensured smoother road and port connectivity, significantly boosting trade and supply chain efficiency. The robust rollout of digital infrastructure under Digital India has facilitated seamless digital payments, e-commerce, and online business transactions — helping Karnataka’s vast network of startups and MSMEs flourish.
The success of Karnataka’s globally renowned IT corridor, especially Bengaluru’s evolution as India’s Silicon Valley, is closely linked to the Union government’s support for knowledge-driven sectors. Special economic zones, tax incentives, and dedicated policies for electronics, semiconductors, AI, and biotechnology have attracted billions of dollars in investment and created lakhs of high-paying jobs for Karnataka’s youth.
Crucially, the Union government’s pro-reform stance has encouraged foreign direct investment (FDI), which has directly benefited the state of Karnataka. In the past decade, the state has consistently ranked among the top recipients of FDI, thanks to investor-friendly policies, single-window clearances, and proactive support from the Centre for mega projects like EV manufacturing clusters and green hydrogen plants.
These achievements have translated into real improvements for ordinary citizens. Higher job creation, better wages, and the expansion of industries into Tier 2 and Tier 3 towns have led to increased household incomes across Karnataka. The rise of tech parks in Mysuru, Hubballi-Dharwad, Mangaluru, and Belagavi shows how balanced growth is spreading prosperity beyond Bengaluru.
Karnataka’s Gross State Domestic Product (GSDP) figures also highlight this steady upward march. For FY 2024–25, the state retained its third position among Indian states with the highest GSDP at Rs 28.83 lakh crore — a robust 2.53 per cent increase from the previous year. Its inflation-adjusted GSDP growth rate rose to 7.37 per cent this year, up from 5.98 per cent in 2023–24. While Tamil Nadu, Andhra Pradesh, Assam, Rajasthan, and Haryana also recorded strong GDP growth, Karnataka’s ability to maintain a high per capita income alongside substantial GDP expansion sets it apart.
Union Minister Pankaj Chaudhary noted in the Lok Sabha that Karnataka’s remarkable economic progress reflects the benefits of cooperative federalism — where the Centre partners with progressive states to accelerate growth. He pointed out that while the Union government retains only one-third of the decision-making power in the GST Council, the bulk of implementation and revenue mobilisation lies with the states. Karnataka’s leadership in per capita income shows how Union-led macroeconomic stability, coupled with strong state-level execution, can deliver lasting prosperity.
Industry leaders have echoed these sentiments. NASSCOM and CII representatives have repeatedly praised the central schemes for skilling, digitisation, and innovation for giving Karnataka’s young workforce a competitive edge. Initiatives like the Production Linked Incentive (PLI) scheme for electronics and solar cells have created new export opportunities for Karnataka’s manufacturers. Meanwhile, PM Gati Shakti has cut transport costs and enhanced supply chain efficiencies for local industries.
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