Embassy of India, Tokyo

India-Japan Bilateral Commercial Relations

The India-Japan commercial and business engagement started when Panasonic set up its manufacturing facility in year 1972. This was then followed by Suzuki and Denso who reached India in early 1980s.

2. Today, India and Japan share a ‘Special Strategic and Global Partnership’. Commercial relations between India and Japan have vast potential for growth, given the complementarities that exist between the two countries. Japan's interest in India is increasing due to a variety of reasons, including India's big and growing market and its resources, especially the human resources. The signing of the historic India-Japan Comprehensive Economic Partnership Agreement (CEPA) and its implementation from August 2011 has accelerated economic and commercial relations between the two countries. During the visit of Hon’ble PM Modi to Tokyo in August 2025, private investment target of JPY 10 trillion from Japan to India for the next decade was announced. This will strengthen India’s manufacturing base, infrastructure and connectivity, promoting “Make in India” initiative to newer horizons. This commitment builds upon the success of the previous investment target of JPY 5 trillion in public and private investment, announced during Hon’ble Prime Minister Kishida’s visit to India in March 2022 and was successfully achieved in three years.

3. Bilateral Trade: Japan’s bilateral trade with India totaled US$ 27.47 billion during FY 2025-26. Exports from Japan to India during this period were US$ 21.43 billion and imports were US$ 6.04 billion. Today, India ranks 14th in Japan’s total trade with 1.75% share while, Japan ranks 10th in India’s total trade with 2.26% share. India ranks 8th in Japan’s total exports with 2.61% share and Japan ranks 21st in India’s total exports with 1.37% share. India ranks 22th in Japan’s total imports with 0.98% share and Japan ranks 10th in India’s total imports with 2.76% share.

4. India’s primary exports to Japan are Organic Chemicals, Vehicles (Other than railways & trams), Nuclear Reactor, Aluminium and Articles thereof, Fish & other aquatic invertebrates. India’s primary imports from Japan are Nuclear Reactors, Copper and Articles thereof, Electrical Machinery and Equipment, Inorganic Chemicals and Iron and Steel. The export-import statistics for the last five years as per India's Ministry of Commerce data bank are as follows:

(US Dollar billion)

5. India-Japan CEPA: India-Japan Comprehensive Economic Partnership (CEPA) Agreement came into effect from 1 August 2011. The Agreement covers not only trade in goods but also services, movement of natural persons, investments, intellectual property rights, custom procedures and other trade related issues. The CEPA envisages abolition of tariffs over 94% of items traded between India and Japan over a period of 10 years. In order to further expand and strengthen the economic and business ties and address the CEPA implementation issues, various Sub-Committees (06) have been established under CEPA in areas of Rules of Origin, Customs Procedures, Technical Regulations, Standards and Conformity Assessment Procedures & SPS Measures, Trade in Services, Improvement of Business Environment, and Movement of Natural Persons & Cooperation. All the six sub-committees have met. A Proposal for setting up of a sub-committee on Trade in Goods under IJCEPA is also presently under discussion between both the sides. The 7th Joint Committee Meeting (JCM) under the Japan-India CEPA at the level of Commerce Secretary and Senior Deputy Minister for Foreign Affairs of Japan was held in Tokyo on 2 March 2026.

6. Japan's Investments in India: Japanese FDI in India has increased in recent years but it remains small compared to Japan's total outward FDI. Japanese outward FDI to India in 2023-24 and 2024-25 stood at USD 3.1 billion and USD 2.48 billion respectively, with USD 3.2 billion in 2025-26 (upto December 2025). Cumulatively, from 2000 until June 2025, the investments to India have been around US$ 44.97 billion ranking Japan fifth among source countries for FDI. Japanese FDI into India has mainly been in automobile, electrical equipment, telecommunications, chemical, financial (insurance) and pharmaceutical sectors. As per Japan Bank for International Cooperation (JBIC) Survey Report on Overseas Business Operations by Japanese Companies for 2025, India maintained its position for the fourth consecutive year as the top promising country over the medium term (next 3 years) with a vote share of 61.8%, up from 58.7% in 2024. India maintained top position in Automobile sector, Electrical equipment & Electronics, Chemical sector and in General Machinery sector rankings.

7. Japanese Companies in India: The number of Japanese companies registered in India are approximately 1434 with manufacturing firms accounting for half the total, according to the latest joint survey by the Embassy of Japan in India and the Japan External Trade Organization (JETRO). These Japanese companies have a total of nearly 5200 business establishments in India. They include liaison and branch offices in India as well as local subsidiaries. Approximately 100 Indian companies are working in Japan. As per the survey on Business Conditions of Japanese-Affiliated Companies Overseas by JETRO for 2025, India ranks 1^st, with 81.5% of Japanese companies willing to "expand" their local operations over the next 1 to 2 years. India had amongst the highest shares of profitable companies at 75.5%, driven by expansion of demand in the local market.

8. India – Japan Industrial Competitiveness Partnership – India – Japan Industrial Competitiveness Partnership – A Memorandum of Cooperation between the Department for Promotion of Industry and Internal Trade (DPIIT) and Ministry of Economy, Trade and Industry (METI) on India – Japan Industrial Competitiveness Partnership was signed on November 16, 2021 to jointly explore the possibilities of enhancing India’s industrial competitiveness with a view to enhance the Special Strategic and Global Partnership between the two countries. The roadmap under IJICP includes setting up of joint working groups between India and Japan in 12 sectors namely logistics, textiles, food processing, steel, automobiles & auto components, industrial capital goods, electronics, telecom equipments, MSMEs, Japanese Industrial Townships (JITs) as well as fast-track mechanism for quick redressal of issues. Under the arrangement, Joint Working Groups (JWG) in different sectors ranging from Textiles and Logistics to Steel and Food Processing have been formed. These working groups are meeting from time to time. The 6^th IJICP meeting, was held on 28^th June 2024 during Vice Minister, METI visit to New Delhi. The 7^th IJICP meeting, co-chaired by the Secretary, DPIIT from India and the Vice Minister for International Affairs, METI from Japan was held in Tokyo on 17^th September 2025.

9. India – Japan SME Forum: During the Annual Summit 2025 held in Tokyo, it was agreed by the leaders of both the countries to launch the India-Japan Small and Medium Enterprises Forum to strengthen collaboration between Indian and Japanese SMEs. This initiative is part of the broader India-Japan Special Strategic and Global Partnership aimed at deepening economic, technological, and strategic collaboration between the two countries. Under the Next Generation Economic partnership one of the key focus area is to encourage cooperation between Small and Medium Enterprises (SMEs) by fostering visits of Japanese SMEs to India. In addition to this, business forums between India and the two regions of Kansai and Kyushu to strengthen business, people to people and cultural linkages were also established. The SME forum was inaugurated on  21st  November 2025 in Tokyo. The  first SME Mission form Japan to India visited on 14-19^th  December 2025 with focus on Aerospace sector.

10. India – Japan Digital Partnership (IJDP) and Start-up Hub: An “India-Japan Digital Partnership” (I-JDP) was launched during the visit of Hon’ble Prime Minister Shri Narendra Modi to Japan in October 2018, furthering existing areas of cooperation as well as new initiatives within the scope of cooperation in S&T/ ICT, focusing more on “Digital ICT Technologies''. This also incorporates setting up “Start-up Hub” between India and Japan. MeitY will be the nodal agency to implement it from the Indian side with the Ministry of Communications (MoC), DIPP, NITI Aayog & other stakeholders and METI from the Japanese side with MEXT and MIC & other stakeholders from the Japanese side. First Startup Hub was established in Bengaluru by JETRO to select Indian start-ups for the Japanese market and for potential Japanese investors. Thereafter, Startup-India (under Invest India) and Japan Innovation Network (JIN) signed an MoU on innovation collaboration with a focus on SDGs (Sustainable Development Goals) connecting two start-up ecosystems in June 2018. Invest India also launched an on-line portal for the Start-up hub. On August 1, 2020, the Japanese Government announced that it would provide financial assistance to 10 Japanese companies planning to start new business in India in cooperation with Indian IT companies as part of the Japan-India Digital Partnership. The objective is to support Japanese companies’ utilisation of IT talents in India. The 7th Joint Working Group on IT & Electronics (Digital Partnership) was held on September 9-10, 2020 through Video Conference between MeitY, India and METI, Japan with participation of relevant government stakeholders and industry participation. The 7th Joint Working Group under India-Japan ICT Comprehensive Cooperation Framework was also held on May 13, 2022 through hybrid mode. The MoU on ICT between India and Japan was signed on January 15, 2021 by the Telecom Minister of India and MIC Minister of Japan. MoU on India-Japan Digital Partnership 2.0 to advance bilateral collaboration in digital public infrastructure, development of digital talent and joint R&D in futuristic technological fields such as AI, IoT, semiconductors was signed during PM visit in Aug 2025.

11. Supply Chain Resilience Initiative (SCRI): A trilateral Economic Ministerial level initiative on Supply Chain Resilience Initiative (SCRI) was launched on September 1, 2020 among Australia, India and Japan through video conference (VC), with an objective to ensure resilience of supply chain through diversification in Indo-Pacific region. In this regard, a Trilateral Ministerial video conference was held by the Trade Ministers of India, Japan and Australia for the formal launch of the Supply Chain Resilience Initiative on 27 April 2021. The Ministers instructed their officials to implement the following as initial projects of SCRI and further develop the Initiative: (i) sharing of best practices on supply chain resilience; and (ii) holding investment promotion events and buyer-seller matching events to provide opportunities for stakeholders to explore the possibility of diversification of their supply chains. During the meeting it was also decided to convene the trilateral Ministerial meetings more frequently. The Second Trilateral Ministerial meeting was held on March 15, 2022.

12. The Embassy of India exchanged Note Verbale with the Japanese Ministry of Foreign Affairs on 29 September, 2016 for the implementation of the Protocol amending theIndian-Japan DTAC(The Protocol entered into force on 29 October 2016). The Protocol provides for internationally accepted standards for effective Exchange of Information in tax matters and that both India and Japan shall lend assistance to each other in the collection of taxes. These provisions will help in preventing international tax evasion and tax avoidance.

13. Cooperation in Skill Development: The Ministry of Economy, Trade and Industry (METI), Japan and the Ministry of Skill Development and Entrepreneurship, India signed a Memorandum of Cooperation (MOC) in November 2016 to facilitate the Japan-India Institute for Manufacturing (JIM) and Japanese Endowed Courses (JEC) projects which aims to train 30,000 floor shop leaders and engineers to Japanese standards in the next 10 years. 42 JIMs and 15 JEC have been launched in India till date. There are approximately 43 companies onboarded by the Japanese side in this collaboration.

14. A MoC on Technical Intern Training Programme (TITP) between Ministry of Justice, Ministry of Foreign Affairs and Ministry of Health, Labour & Welfare of Japan and Ministry of Skill Development and Entrepreneurship was signed in October 2017 with National Skill Development Corporation (NSDC) as the implementing body for TITP.

15. The Memorandum of Cooperation (MoC) between India & Japan on a Basic Framework for Partnership for Proper Operation of System Pertaining to "Specified Skilled Worker" (SSW) was signed on 18 January 2021 which will further promote the movement of skilled workers from India to Japan in designated 73 operations in 14 specified industries fields / job categories and thus marks a further step to augment India-Japan collaboration in the area of skill development. In this regard, Japan Foundation Test for Basic Japanese (JFT-Basic), Nursing care skills evaluation test and Nursing care Japanese language evaluation test were held in January 2022, in Gurugram, India for the first time. During the Annual Summit in August 2025, under India-Japan Human Resource Exchange, an action plan to promote two-way exchange of 500,000 people between India and Japan, particularly 50,000 skilled and semi-skilled personnel from India to Japan in the next five years was jointly agreed upon.

16. India-Japan Textile Cooperation: A Memorandum of Understanding was signed between Textiles Committee, Ministry of Textiles, Government of India and M/s Nissenken Quality Evaluation Centre, Japan on January 27, 2021 to provide required support to textile’s trade and industry for ensuring quality as per the requirement of Japanese buyers through Testing, Inspection & Conformity Assessment, Training & Capacity Building, Research & Development (R&D) and Consultancy. 2nd India-Japan Joint Working Group (JWG) meeting was held via video conference on 11th July 2023. The main points of discussion were: Possibility of cooperation between M/s Nissenken Quality Evaluation Center and Textiles Committee of India in setting up more Quality Evaluation Centres in India as per the requirement of Japanese buyers. METI expressed interest to promote investment and expand trade between Japan and India as well as expand the efforts of the human resource development program to improve the quality evaluation ecosystem. A high-level delegation led by Shri Giriraj Singh, Hon’ble Minister of Textiles (HMoT), Government of India along with industry representatives like AEPC, PDEXIL, TEXPROCIL, MATEXIL, stakeholders from state governments, and Invest India team, visited Tokyo from 14-17 July 2025.

17. Energy Dialogue: This dialogue was set up in December 2006 to promote cooperation in the energy sector in a comprehensive manner. The dialogue is chaired by the Deputy Chairman of the Planning Commission from the Indian side (now chaired by the Minister of Power) and METI Minister on the Japanese side. Till date, ten rounds of the meetings have taken place. The 10th meeting of the Japan-India Energy Dialogue was held in Delhi on 10 December 2019. India-Japan Clean Energy Partnership (CEP) was launched in March 2022. A high-level delegation led by Shri Hardeep Singh Puri, Hon’ble Minister of Petroleum and Natural Gas (MoPNG), Government of India with industry representatives such as IOCL, ONGC, HPCL, GAIL and BPCL visited Tokyo from 16-19 November 2025.

18. Japanese Official Development Assistance (ODA): Japan has been extending bilateral loan and grant assistance to India since 1958. Japan is the largest bilateral donor to India. The Japanese ODA supports India’s efforts for accelerated economic development particularly in priority areas like power, transportation, environmental projects and projects related to basic human needs. Accumulated commitment as of date is over JPY 8.5 trillion in total (equivalent to about ₹4.9 trillion) with around 100 ongoing projects.  Government of India and Government of Japan have signed loan agreements worth JPY 275.858 billion in March 2026, to fund four projects in urban transport, health, and agriculture sector, further strengthening the long-standing development partnership between the two countries.

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