Draft of Karnataka’s new biotech policy to be ready by year-end

R Baby Manoj - Bangalore

The draft of the new biotechnology policy of the Karnataka state government will be ready by the end of this year, it is learnt.

According to sources in the state government, there will be major changes in the policy. “We were waiting for the National Biotech Policy to be introduced. Since its announcement, we have been working in full swing in the re-drafting of the current policy.”

The sources added that the policy would be more investor-friendly and would increase the pace of growth of the industry in the state. ‘‘Biotech R&D and biotech education will get a major boost in the new policy.’’

The work for Biotech Park in Bangalore envisaged in the current policy is expected to begin this month itself, it is learnt. It is also learnt that an amount of Rs 15 crore is earmarked for this project. The park will be set with an aid from the Department of Biotechnology, Government of India.

The current policy has six major objectives, namely, to spread awareness about the opportunities in biotechnology, genomics, biofuels, contract research etc to the entrepreneurial community; to sustain and maintain the present pre-eminent position of Bangalore; to outline a set of incentives and concessions for the biotechnology industry to attract investments to the state; to provide specific infrastructure as well as enhance human resources; to encourage the growth of bioinformatics, and to provide an appropriate institutional framework to achieve all these objectives. The crux of the new policy also is expected to be on these lines.

The current policy offers a number of fiscal incentives including the exemption from entry tax on all inputs as well as capital goods including captive generation sets during the implementation stage up to a period of five years. The new policy may offer more sops to the entrepreneurs.

A number of concessions are already being offered by the current policy to mega projects (projects of investment worth more than Rs 50 crore or employing 250 people of Bangalore or 100 people in any other city in Karnataka) in the biotechnology sector including that on stamp duty and registration charges for the first sale and lease.

The current policy also offers electricity tax exemption on captive power generation sets installed by the industry for a period of five years. As per the existing policy, there are certain advantages for bioinformatics companies in that there will not be any locational restrictions if they use upto 5 kVA of power only. When compared to the current policy which was not very successful in ensuring a continuous flow of venture capital, the new policy is expected to redress this drawback.

Since exemption was extended to information technology of the sections of labour laws restricting the opening and closing time of shops, the same was done to BT companies in the current policy. The recent amendment in the labour law permitting women in nightshift is naturally applicable to BT. Two biotech parks were proposed in the last Biotech Policy, one in Bangalore and the other in Dharward. The new policy may envisage more such parks in the state. This is likely since the government is closely watching competition in neighbouring states.

Recently the neighbouring state Kerala has begun its work for setting up an International Biotech park in Kochi, its commercial hub in a 50 acre area. A ‘Biotech Corridor’ envisaged in the current policy by co-ordinating prestigious institutions in Bangalore has become a reality. The current policy envisaged a National Centre for Human Genetics too. The state government had realised the need for strengthening education in scientific computing, bioinformatics, genomics, electronics etc, and founded Institute of Bioinformatics and Applied Biotechnology (IBAB) in association with ICICI group.

The policy gave way to Institutional Framework for Promoting Biotechnology under the leadership of the Department of Information Technology and Biotechnology. There is a separate Biotechnology Fund. Apart from budgetary allocation, Funding was planned from other sources as well.

The Vision Group on Biotechnology envisioned in the policy has been so far quite successful. The Single Window Agency consisting of secretaries of various departments have been engaged in clearing all projects of the biotechnology industry. The agency has been following up both in principle and actual sanction by the respective departments.

Another office set up by the policy is the Karnataka Biotechnology Development Council (KBDC) which is developing norms for setting up biotech companies. It holds seminars, conducts research, represents trade and interacts with the government departments successfully. The council is funded by the government, by contributions from the Biotech Fund and from other sources. Each biotech company was expected to contribute 0.5 per cent of its annual turnover to this fund.

— rbmanoj@expressindia.com