Tue. Jun 25th, 2024
Kerala's Draft IT Policy 2023Kerala's Draft IT Policy 2023


Kerala’s Draft IT Policy 2023 represents a significant shift towards local employment and sustainable development in the technology sector. This ambitious policy aims to balance economic growth with social responsibility, offering incentives to boost local employment and support diverse communities.

Encouraging Local Employment

A central feature of the policy is the encouragement of local hiring. Private land developers and investors are incentivized to prioritize hiring candidates from Kerala. Specifically, offering 50% of jobs to local residents will make investors eligible for special incentives. This initiative not only supports the local workforce but also aims to strengthen the state’s economy.

Investment-Based Incentives

The policy introduces a tiered incentive system based on investment size and job creation. For investments ranging from ₹100 crore to over ₹1,000 crore, and direct employment generation from 1,000 to 5,000 jobs, investors will receive corresponding incentives.

Capital Subsidies and IT Park Support

The government will offer capital subsidies for new or expanded IT/ITeS/BPO units. These are based on investments in Eligible Fixed Assets (EFA) and are back-ended. Additionally, to support co-developers in IT parks, the government proposes various leasing options for government-owned land, including a 99-year lease and flexible payment plans.

Additional Incentives

The draft policy includes multiple incentives like SGST reimbursement, power tariff extensions, and stamp duty exemptions. There are also special subsidies for employing women, differently abled, and third-gender individuals, along with incentives for green campus initiatives and 5G infrastructure development.

Emphasis on Diversity and Inclusion

Organizations employing diverse groups, including transgender, neurodivergent, and differently-abled individuals, can receive significant financial aid. This includes salary reimbursement as rent discounts and additional rent discounts for organizations with diverse boards or employee structures.

Fostering Women’s Employment

Organizations with over 50% women employees are eligible for a 10% discount on base rent for 12 months. This initiative is aimed at promoting gender equality and empowering women in the IT sector.

Ambitious Market Share Goals

The policy sets an ambitious target for Kerala to capture 10% of India’s IT market share within five years, aiming to create half a million new jobs in the IT and allied sectors.

Startup and Entrepreneurship Support

The government plans to increase the number of startups in Kerala to 20,000. This will be facilitated by setting up small-format co-working spaces in neighboring towns and the FOSTeRA scheme, which focuses on fostering technologies in rural areas.


Kerala’s Draft IT Policy 2023 is a forward-thinking approach to balancing economic growth with social and environmental responsibility. It aims not only to boost the local economy and employment but also to foster diversity, inclusion, and sustainable development in the IT sector. As the policy is finalized, it will be crucial to monitor its implementation and impact on Kerala’s IT landscape.

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