Just 15% of Karnataka MoUs in project phase in 2.5 years

BENGALURU : Karnataka, holding roadshows within India and overseas to attract investments, has a 15% strike rate when it comes to converting memorandums of understanding into projects for the period June 2023 to Oct 2025.According to the industries department, as many as 117 MoUs worth Rs 6.7 lakh crore were signed, with the potential to create 2.5 lakh jobs. So far, 17 projects have been approved, which are expected to bring Rs 25,055 crore in investments and generate 13,882 jobs. The data was tabled in the recent legislature session in Belagavi.Industry department explained the seemingly sluggish conversion rate to the long project runway of up to seven years, and said calendar year-wise realisation data suggests a conversion rate of 50%.

The period under review refers to first two-and-ahalf years of Cong govt, which took office in May 2023.While the govt says an enabling and favourable industrial environment is spurring growth, industry veterans, while welcoming industries minister MB Patil’s commitment, point to “lethargy in the system” and infrastructure bottlenecks. Interestingly, 13 of the 17 projects are in and around Bengaluru.Comparing the state’s policies with those of Tamil Nadu and Andhra Pradesh, industry observer TV Mohandas Pai told TOI , “The high-level committee has almost no impact on the ground.

You have to pay bribes at multiple levels. If high-level committees are headed by the CM, then no further approvals are required. Our CM, a strongman, should review implementation every month and sack those who do not perform.” Uma Reddy, president, FKCCI, flagged lack of land and inadequate infrastructure as a key concern.Principal secretary (commerce and industries) S Selvakumar said these are big projects that translate to about Rs 5,000 crore per company. After MoUs, companies conduct due diligence before seeking approvals for land, water, electricity. Usually, demands are placed within 3-4 years of MoUs being signed. Then it takes another three years to implement the project.