Although historical exchanges between Japan and India began in the 6th century with the introduction of Buddhism, modern-day diplomatic relations started in 1952 leading to the systematic growth in trade and economic relations. Japan started providing yen credit to India in 1958 and since then Japan has been actively contributing in a big way towards the development of India. Since then the growth of Industrial, Trade, and Economic relations between the two countries began to develop steadily.
The two countries work across sectors and relations span over areas such as the Manufacturing industry, Drugs and Pharmaceuticals, Health and Medical care, Transportation, Power and energy, Urban development, Environmental management, and agricultural and rural development.
The alliance thrives on the synergy of our complementary economies, with sectors such as technology, electronics, automotive, and infrastructure providing fertile ground for mutually beneficial exchange.
The two countries are witnessing increasing bilateral and multilateral engagement and strengthening of the India-Japan Special Strategic and Global Partnership.
Industry
Industrial collaboration between Japan and India started with the Collaboration for Maruthi cars and it has been expanding since then.
Today, India emerged as the second most favored destination for Japanese outward foreign direct investment (FDI) in the medium term, according to (JBIC) Survey Report. While Japanese FDI in India has seen growth in recent years, it still constitutes a relatively small portion compared to Japan’s overall outward FDI.
Cumulatively, between 2000 and June 2023, Japan’s investments in India amounted to around US$38.74 billion, ranking Japan fifth among the source countries for FDI.
A growing opportunity for investment and trade welcomes Japan. Improvements in the investment climate and business environment in India will further aid the entry of Japanese companies.
As of June 2022, a total of 1,439 Japanese companies have a presence in India, with manufacturing firms accounting for half this figure. Between 2000 and 2022, Japanese investments in India were worth $37.8 billion, ranking Japan fifth among source countries for FDI.
Most of these investments have been in electrical equipment, general machinery, chemicals and pharmaceuticals, financial and insurance sectors, construction, transportation, wholesale and retail, and services.
Several Japanese companies have already begun their operations in Telangana and Andhra Pradesh region.
NRJH aims to support the companies in the region through its Language Teaching, Interpretation, and Translation Services.
NRJH provides training in Japanese Management practices and Work ethics to support the training of technical manpower and enable them to work well in the industry, especially in the Japanese Industry.
NRJH also promotes a dialogue between the Indian and Japanese counterparts in the region to discuss the issues related to SDG and related collaboration.
Trade
• Japan’s bilateral trade with India totaled US$ 21.96 billion during FY23.
• Exports from Japan to India during FY23 were US$ 16.49 billion and imports were US$
5.46 billion.
• Japan’s exports to India were 2.35% of India’s total imports and India’s exports to
Japan were 1.46% of India’s total exports.
• Japan’s bilateral trade with India from April-May 2023-24 totaled US$ 3.87 billion.
Indian Export Items
- India exported 4,508 commodities to Japan in FY21.
• Major exported items from India to Japan include marine products, petroleum products, Iron ore, organic chemicals, products of aluminum, pearls, and Jewels, Chemicals, auto components, etc.,
Japanese Export Items
- Japan Exports 4,359 commodities.
• Japan exports residual chemicals, iron, and steel, copper, Machinery, Iron and Steel,
plastic raw materials, etc.
We at NRJH aim to facilitate the Indian and Japanese dialogue on the trade relations between our two nations especially in relation to possible initiatives from Hyderabad for the regions of Telangana and Andhra Pradesh through seminars and roundtables to iron out the impediments and identify ways to expand the bilateral trade between the two countries/regions.
Economy
In recent years, the economic relationship between Japan and India has steadily expanded and deepened.
Economic relations between the two nations enjoy vast potential for growth, given the obvious complementarities that exist between the two economies. Japan's interest in India is increasing due to a variety of reasons including India's big and growing market and its resources, especially human resources. The signing of the historic India-Japan Comprehensive Economic Partnership Agreement (CEPA) and its implementation in August 2011 has accelerated economic and commercial relations between the two countries.
During the visit of the Hon’ble Prime Minister of Japan Mr. Fumio Kishida to India in March 2022, both Prime Ministers expressed the intention to realize US$ 37 billion (JPY 5 trillion) of public and private investment and financing from Japan to India in the next five years.
The Prime Ministers of Japan and India confirmed to promote investment by Japanese companies in India. The two leaders also agreed to promote the "Clean Energy Partnership" to achieve carbon neutrality and promote cooperation in the areas of hydrogen, ammonia, and LNG through the "Japan-India Energy Ministerial Dialogue" and other initiatives.
India has been the largest recipient of Japanese ODA loans for the past decades. Delhi Metro is one of the most successful examples of Japanese cooperation through the utilization of ODA. Japan continues to cooperate in supporting strategic connectivity linking South Asia to Southeast Asia through the synergy between the ''Act East'' policy and ''Partnership for Quality Infrastructure.''
The Mumbai-Ahmedabad High-Speed Rail, the Western Dedicated Freight Corridor (DFC), the Delhi-Mumbai Industrial Corridor with twelve industrial townships, the Chennai-Bengaluru Industrial Corridor (CBIC) are all mega projects on the anvil which will transform India in the next decade. Japan’s Shinkansen System, is a flagship project of Japan-India relations.
NRJH aims to promote a dialogue between the Indian and Japanese counterparts in the region to discuss how to expand the economic relations of the Telangana and Andhra Pradesh regions with Japan.