Entrepreneurship in the Digital Era: An Empirical Analysis of Digital Infrastructure, Policy Interventions, and Entrepreneurial Activity in Karnataka, India

Abstract India’s entrepreneurial landscape is undergoing a massive digital shift. Echoing the Katha Upanishad’s call, "उत्तिष्ठत जाग्रत प्राप्य वरान् निबोधत" (Arise, awake, and stop not until the goal is reached), today’s founders leverage robust digital infrastructure and initiatives like Startup India, Digital India, and the UPI revolution. This reflects "योगः कर्मसु कौशलम्" (excellence in action), melting entry barriers, especially in tech-forward Karnataka. However, existing literature heavily relies on primary surveys, lacking empirical evidence linking digital infrastructure and policy support to measurable business outcomes via secondary data. To bridge this gap, our study examines the relationship between state-level digital infrastructure, policy support, and entrepreneurial activity among startups and MSMEs in Karnataka from 2019 to 2024.Utilising a quantitative, secondary-data design, we analysed aggregate trends from DPIIT, RBI, and NASSCOM. Our findings reveal a strong positive correlation: as digital payment volumes and internet penetration rose, so did new firm registrations. Crucially, Karnataka’s mature startup ecosystem acts as a force multiplier, amplifying these benefits. Additionally, new-age digital firms exhibit distinct market valuation patterns compared to traditional counterparts. Ultimately, digital public infrastructure and targeted policies are vital enablers, but their impact is moderated by regional ecosystem maturity. To realise the vision of "तमसो मा ज्योतिर्गमय" (Lead me from darkness to light), policymakers must extend digital infrastructure beyond metros into Tier-2 and Tier-3 cities. Future research should integrate primary data to validate these secondary trends.