Japan to Help India Boost its Manufacturing, Trade and Investment

September 17, 2013 Posted by India Briefing Reading Time: 2 minutes

Sept. 17 – Japan will help India boost its manufacturing exports through a program designed to facilitate greater cooperation between the two countries. The program, which was announced this week during a meeting between India’s Minister of Commerce Anand Sharma and Japan’s Minister of Economy, Trade and Industry Toshimitsu Motegi, will continue a long-standing business friendship between India and Japan.

“Our action plan focuses [on] investment in export-oriented manufacturing. Japan has shown tremendous interest that will lead not only foreign investment flows, [but also] bring in a culture of quality and high-end management practices in Indian industry along with creation and strengthening supply chains,” said Anand Sharma.

The plan will take a multifaceted approach to connect Japanese investors and businesses with Indian enterprises in an effort to leverage the full potential of Japanese-Indian trade.

“There are huge opportunities for investment in sectors like infrastructure including investments in power, metals, renewable energy, manufacturing, automobiles and auto parts and creative industries,” Sharma further commented.

Under the plan, the Japan External Trade Organization (JETRO) will work to consolidate India’s automotive manufacturing supply chain by sponsoring business matching events. These forums will enable Indian manufactures to build business alliances directly with Japanese companies.

JETRO will also establish two SME Overseas Business Support Platforms in Mumbai and Chennai to assist small and medium-sized Japanese enterprises develop investments within India.

In order to facilitate greater investment cooperation, the establishment of investment centers in both Japan and India was also proposed. The centers would highlight both Central and State Governmental policies and regulations governing investment and trade in India and Japan. These facilities would also process operating licenses and permits, as well as promote investment incentives.

According to an Indian press release, the plan is expected to strengthen India’s export industry while providing Japanese enterprises greater access to India’s trading partners, such as countries in the Indian Ocean Rim Association for Regional Cooperation.

Over the last decade, Japan and India have worked hard to increase trade and investment relations. As a BRICS country, India has provided great growth potential for international investors from mature economies to expand their market share abroad. Taking advantage of this trend, Japan has assisted in several high-profile projects throughout India. The heaviest investments have been made in Delhi, Chennai and Bangalore, with projects throughout the rest of the country also undertaken.

Since 2005, Japan has invested over US$15 billion into Indian companies and infrastructure projects, according to JETRO statistics. As of 2011, India was also home to nearly 1,500 Japanese funded project sites. As Japanese enterprises continue to invest in India, this number is expected to reach 2,500 by 2015.

Dezan Shira & Associates is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in emerging Asia. Since its establishment in 1992, the firm has grown into one of Asia’s most versatile full-service consultancies with operational offices across China, Hong Kong, India, Singapore and Vietnam as well as liaison offices in Italy and the United States.

For further details or to contact the firm, please email india@dezshira.com, visit www.dezshira.com, or download the company brochure.

You can stay up to date with the latest business and investment trends across India by subscribing to Asia Briefing’s complimentary update service featuring news, commentary, guides, and multimedia resources.