The Karnataka government will set up an Innovation Authority and a vision group for startups, Deputy Chief Minister CN Ashwath Narayan said addressing officials from the Information Technology (IT) and Biotechnology (BT) department and senior executives in IT and BT companies at an event in Bengaluru on Thursday. 

"The Government of Karnataka will establish a 'Legal Framework for Innovation' with the aim to encourage new and emerging technologies in the state," Ashwath Narayan said. A Vision Group will also be created for startups in the state which will involve industrialists and academicians.

The state government is set to introduce a draft bill to establish regulatory sandboxes in Karnataka. "We are working on a draft bill which proposes to establish a mechanism for the creation of regulatory sandboxes in Karnataka, which will broadly describe a set of conditions under which innovative technologies can be tested in a controlled testing environment by relaxing regulatory requirements," Ashwath Narayan added.

A regulatory sandbox refers to live testing of new products or services in a controlled test environment for which regulators may (or may not) permit certain regulatory relaxations for the purpose of the testing. This allows regulators and innovators to conduct field tests and collect evidence on new innovations while monitoring risks.

The Innovation Authority will be chaired by Chief Minister BS Yediyurappa and CN Ashwath Narayan. The details of the Innovation Authority will be announced at this year's Bengaluru Tech Summit (BTS), scheduled to be held from November 18-20 this year. The event will focus on startups and innovation with the theme of the event being 'Innovation and Impact'.

Addressing the meeting, BS Yediyurappa said that the state government will urge companies to make investments in places other than Bengaluru like Mysuru, Mangaluru, Hubballi-Dharwad, Shivamogga and Belagavi. "The policy will focus on attracting investments and generating employment in Tier-2 and Tier-3 cities," Yediyurappa said.

When asked whether Kannada-speaking residents of the state will be preferred for jobs in companies, Ashwath Narayan said, "Any city will have a confluence of talent from around the world and in the increased competition will only help innovation. We will also strive to increase the percentage of Kannadigas in the IT industry.”

The idea for setting up an Innovation Authority was earlier brought up during former Chief Minister HD Kumaraswamy's tenure in 2018 but it did not come to fruition.