Japan PM Ishiba: I have set a target for 10 trillion Yen of Japanese private investment in India

Japan PM Ishiba: I have set a target for 10 trillion Yen of Japanese private investment in India

Prime Minister Shigeru Ishiba has set a target of ¥10 trillion (approximately $68 billion USD) in Japanese private investment in India over the next decade, as reported by Japan Forward [1]. This ambitious goal is part of Japan's strategy to bolster economic ties and cooperation with India, coinciding with Indian Prime Minister Narendra Modi's upcoming visit to Japan.

The target, which is a significant revision of the previous ¥5 trillion (around $34 billion) five-year investment goal set by former Prime Minister Fumio Kishida, aims to encourage further private-sector investment in India. The new target is expected to be confirmed during Ishiba's summit with Modi, scheduled for August 29-30. The summit is also anticipated to unveil new economic and AI cooperation initiatives.

The Japanese and Indian governments are collaborating to establish a new framework, the "Economic Security Initiative," focusing on essential materials such as semiconductors, rare earth minerals, communications, clean energy, AI, and pharmaceuticals. Additionally, they are coordinating the launch of an "AI Cooperation Initiative" to strengthen partnership in AI and support for startups and emerging companies.

This initiative comes amid challenges in trade relations with the US, with both countries seeking to strengthen their bilateral trade and investment partnerships. The Economic Times reported that the summit will see the signing of Memorandums of Understanding (MoUs) aimed at boosting Japanese investments in India [2]. Over the past two years, Japan has signed nearly 170 MoUs with India, representing over $13 billion in committed investments across various sectors such as steel, automotive, renewables, semiconductors, real estate, and aerospace.

By integrating Indian SMEs into global supply chains, Japanese companies are playing a crucial role in India's economic development. For instance, Tokyo Electron and Fujifilm are collaborating with Tata Electronics to build a semiconductor ecosystem, while Toyota and Suzuki are integrating Indian SMEs into their value chains. Fujitsu is also set to recruit 9,000 Indian engineers for its Global Capability Centre.

The ¥10 trillion investment target underscores Japan's confidence in India's long-term economic potential and its commitment to strengthening bilateral ties. As the two countries navigate the complexities of global trade dynamics, this investment target represents a significant step towards deepening their economic partnership.

References:
[1] https://japan-forward.com/japan-eyes-%C2%A510-trillion-investment-target-in-india-ahead-of-modi-summit/
[2] https://economictimes.indiatimes.com/news/economy/foreign-trade/india-japan-look-to-boost-trade-amid-tariff-tower/articleshow/123570796.cms