Karnataka offers startups up to ₹25 lakh for government pilots
Kalpana Maurya
1 Oct 2026 · 3 min read
Karnataka will back roughly 100 startups with pilot work orders of up to ₹25 lakh each under its ₹25 crore Government First initiative. The scheme aims to turn state departments into early customers, giving young companies a route from a live trial to government procurement.
The Karnataka government has set up a ₹25 crore programme, called Government First, that will pay up to ₹25 lakh per startup to test products inside state departments. About 100 startups are to be supported over three years, and the Karnataka Innovation and Technology Society (KITS) will run the scheme, according to guidelines reported by YourStory on 30 September 2026.
The initiative sits under the ELEVATE programme of the Karnataka Startup Policy 2025-30. IT/BT minister Priyank Kharge first outlined it earlier in September, describing the aim as making the government "a first customer and partner for promising startups", Indian Startup News reported.
How the pilots will work
There are three ways in. A department can publish a problem and ask startups to respond; a startup can approach a department on its own with a product that fits a public need; or an already selected solution can be trialled directly in a live government setting.
Proposals will be gathered and judged together in quarterly cycles. Committees of domain experts and government representatives will score them on technical feasibility, innovation, product readiness, scalability, ability to integrate with existing systems and social and economic impact.
Once a pilot starts, the host department is expected to provide the infrastructure needed, monitor the work and give domain guidance. The trial is then assessed on performance, usability, cost-effectiveness, scalability and measurable impact. Pilots that hit their targets can move towards procurement and wider roll-out, and the guidelines also allow direct procurement for products that are already ready to deploy. Where it makes sense, one product can be picked up by several departments, or solutions from different startups can be combined to tackle a larger problem.
Who can apply and how the money flows
Applicants must be registered in Karnataka, be less than 10 years old and have had annual turnover of no more than ₹200 crore in any year since incorporation. Their solutions must be at Technology Readiness Level 7 or higher, meaning they have already been validated in an operational environment. Physical goods, specialised services and end-to-end solutions are all eligible, with IT, AI, data analytics, consulting, design, logistics and hardware among the listed areas.
Of the ₹25 crore outlay, ₹23.75 crore is set aside for startup assistance and ₹1.25 crore for administration. A startup receives 25% of its pilot payment when the work order is issued and the remaining 75% after the user department signs a completion certificate. The startup keeps its intellectual property unless both sides agree otherwise.
The state also plans a public dashboard listing work orders, implementation details and case studies, plus an annual report on the number of startups engaged, work-order values and outcomes.
Why it matters
Selling to government is often the hardest step for an early-stage company, because departments rarely buy untested technology. By paying for the trial itself and spelling out a path to procurement, Karnataka is trying to give startups a reference customer in the public sector while letting departments evaluate tools before committing to them at scale.
Key facts
- Scheme: Government First, under the ELEVATE programme of the Karnataka Startup Policy 2025-30
- Implementing agency: Karnataka Innovation and Technology Society (KITS)
- Total outlay: ₹25 crore over three years (₹23.75 crore for startups, ₹1.25 crore for administration)
- Support per startup: up to ₹25 lakh for a pilot
- Startups covered: about 100
- Eligibility: Karnataka-registered, under 10 years old, turnover of ₹200 crore or less, TRL 7 or above
- Payment: 25% on work order, 75% on completion certificate
- Reported: 30 September 2026 (guidelines); first announced earlier in September
Frequently asked questions
How much can a startup get under Karnataka's Government First initiative?
Each selected startup can receive up to ₹25 lakh to run and validate a pilot with a government department.
Who is eligible?
Startups registered in Karnataka that are under 10 years old, have never crossed ₹200 crore in annual turnover and have a solution at Technology Readiness Level 7 or higher.
Who runs the scheme?
The Karnataka Innovation and Technology Society (KITS) will implement it under the ELEVATE programme of the Karnataka Startup Policy 2025-30.
Does the startup keep its intellectual property?
Yes. IP stays with the startup unless a different arrangement is mutually agreed.
What happens after a successful pilot?
Solutions that meet their targets can move towards government procurement and wider adoption, and deployment-ready products may be considered for direct procurement.
