Japan known as the Land of Rising Sun is a part of a long chain of mountains South East Asia

to Alaska. It comprises of over six thousand islands. It has long rocky coastline with many small
and excellent harbours, numerous valleys, rivers and lakes. Mountainous and hilly areas account
for over 75% of total area. Mt. Fuji is the highest mountain.

Japan is prone to tremors

(Vibration) and earthquakes.

Major Export Destinations USA (18.6 %), China (18.4%), South Korea (7.8%), Taiwan
(FY 2013)
(5.8%), Hong Kong (5.3%), Thailand (4.8%), Singapore (3.0%),
Germany (2.7%), Australia (2.3%), Indonesia (2.3%)
Major
Import
(FY 2013)

Sources China (22.0%), USA (8.4%), Australia (6.1%), Saudi Arabia

(6.0%), UAE (5.1%), Qatar (4.5%), South Korea (4.2%), Malaysia
(3.6%), Indonesia (3.4%), Russia (2.9%)

Major Items of Exports

Motor Vehicles, Semiconductors, Iron & Steel products, Parts of

Motor Vehicles, Plastic materials, Power generating machinery,
Organic chemicals, Scientific & Optical instruments, Ship and
Electrical apparatus.

Major Items of Imports

LNG, Clothing & accessories, Petroleum products,

Semiconductors, Computer units & parts, Coal, non-ferrous
metals, Audio and Visual apparatus, Medical Products

Japans Major Industries

Motor Vehicles, Electronic Goods, Machinery & Machine Tools,

Steel & Non Ferrous Metals, Ships, Chemicals, Textiles,
Processed Food

The friendship between India and Japan has a long history because of spiritual similarity and
strong cultural and civilizational ties. The modern nation states have carried on the positive
heritage of the old association which has been strengthened by belief in democracy, individual
freedom. The two countries have built upon these values and created a partnership based on both
principle and common sense. Today, India is the largest democracy in Asia and Japan the most
prosperous nation.
India Japan Trade Relations is as old as post world war II era. The trade relations between
India and Japan flourished after the establishment of diplomatic ties, especially after the World
War II. Japan bring back to life form the debacle of the World War II loss with the help of India's
iron ore export. Japan reciprocated India by providing yen loans to India in 1958, by Japanese
government. And as a matter of fact since then, Japan is India's largest aid donor.

Bilateral Trade
In the Financial Year (FY) 2011-12, Japan-India bilateral trade reached $18.43 billion, showing
increase of 34.33% over FY 2010-11, when the total bilateral trade was $13.72 billion. India's
exports to Japan grew by 24.36% as against the growth of 40.2% in its imports from Japan in FY
2011-12. The export-import statistics for the last seven years as per India's Ministry of
Commerce data bank are as follows:
(In US dollar billion)
Year

2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

EXPORT

2.48

Indias Total Export

103.09 126.41 163.13 185.29 178.75 251.13 305.96

%Share

2.41

2.27

2.37

1.63

2.03

2.07

2.07

IMPORT

4.06

4.59

6.32

7.89

6.73

8.63

12.10

Indias Total Import

149.17 185.73 251.65 303.69 288.37 369.77 489.32

%Share

2.73

2.48

2.52

2.6

2.34

2.33

2.47

TOTAL TRADE (with Japan)

6.54

7.46

10.18

10.91

10.36

13.72

18.43

2.87

3.86

3.02

3.63

5.09

6.33

Indias primary exports to Japan : petroleum products, iron ore, gems and jewelry, marine
products, oil meals, ferroalloys, inorganic/organic chemicals, etc.
Indias primary imports from Japan : machinery, transport equipment, iron and steel, electronic
goods, organic chemicals, machine tools, etc.
Japanese FDI into India
India is favoured destination in Asia for Japanese FDI. DIPP statistics showed that Japanese
companies have made actual investments of $12.66 billion to India between April 2000 and
June 2012. This accounted for 7% of total FDI inflow into India and made Japan the 4th largest
investor in India. The number of Japanese affiliated companies in India has grown significantly
over the last five years and nearly 1000 Japanese companies are operating in India. Japanese

FDI into India has mainly been in automobile industry, electrical equipments, pharmaceuticals,
trading and telecommunications sector. Indias growing economy and stable investment climate
offer large opportunities for Japanese companies.
Japanese companies are taking interest in India as destination for overseas investment. India
ranked the top as promising country over long term in both FY 2012 and FY 2011 surveys
conducted by the Japan Bank of International Cooperation (JBIC).India was also ranked a top as
promising country for overseas operations over medium term with regard to automobile industry
in the 2012. India, ranked as a promising countries for overseas business over medium-term and
regard to major industries including chemicals, general machinery, electrical equipment &
electronics.
Bilateral cooperative science programme
In order to develop enhanced and diversified cooperation in different areas, another major
program is:
India-Japan Cooperative Science Programme(under the aegis of India Japan Science Council
(IJSC)) was initiated in 1993. To review the progress and decide next years activities an IndiaJapan Science Council (IJSC) has been set up.

For IJSC, Japan Society for the Promotion of Science (JSPS) is the counterpart
agency of the Department of Science and Technology (DST), Government of India

India Japan Science Council is working for last 22 years and has so far been a very
effective vehicle of S&T cooperation between the two countries.

closer ties between Indian and Japanese scientific communities through joint programmes
such as research projects, seminars, visits of scientists, Fellowships and Asia Academic
Seminars. Priority areas under this programme are the following:
a) Molecular Structure, Dynamics and Molecular Materials, including Supramolecular
Science.
b) Advanced Materials, including Polymers and Nano-materials
c) Modern Biology and Biotechnology

d) Manufacturing Sciences
e) Astronomy & Astrophysics
f) Surface and Interface Sciences
MOUs Signed
1. MoU between DST and KEK Tsukuba (High Energy Accelerator Research Organisation) was
signed during PMs visit on 22 October 2008 for leasing a synchrotron beamline and
constructing an experiment hutch for research in the area of material science and the Photon
Factory KEK.
2. MoU between DAE and KEK Tsukuba (High Energy Accelerator Research Organisation) was
signed on 23 January 2012 for cooperation and collaboration viz. Belle II experiment at KEK,
particle detector development, synchrotron science, accelerator science and school and
workshops.
3. MoU between Indian Nuclear Society and Japan Atomic Energy Society was signed on 6
September 2013 in the presence of Ambassador at Embassy of India.
4. A multi-institutional MoU was signed between DST, DBT and NCBS from India and RIKEN,
Japan in Bangalore on 15 September 2013.
5. DBT-AIST Agreement was renewed on 3 October 2013 and DBT-AIST DIALAB facility was
inaugurated in Tsukuba.
6. An Implementation Arrangement between MEXT and DST was signed on 25 January 2014
during the visit of Prime Minister Shinzo Abe to India.
7. DBT-AIST working agreement to establish DBT-AIST DIALAB facility at DBT Regional
Centre in Delhi was signed on 4 March 2014.
According to a survey conducted by the Japan Bank for International Cooperation (JBIC)
covering 620 Japanese manufacturing companies for the year 2008, India remains the second

favourite investment destination for Japanese companies after China. More Japanese companies
are looking at India and other emerging countries favourably
Investors were looking at pharmaceuticals and healthcare, telecommunications, steel, logistics
and financial services apart from the usual automotive industries investments.
Lupin, Dr Reddys and Zydus Cadilla have wholly-owned units, Ranbaxy Laboratories, now
owned by Japans Daiichi Sankyo, has a 50:50 joint venture with another local player and a
marketing subsidiary.
Economic and Commercial Cooperation
In the economic sphere, the complementarities between the two countries are particularly
striking. (i) Japans ageing population (23% above 65 years) and Indias youthful dynamism
(over 50% below 25 years); (ii) Indias rich natural and human resources and Japans advanced
technology; (iii) Indias prowess in services and Japans excellence in manufacturing; and (iv)
Japans surplus capital for investments and Indias large and growing markets and the middle
class.
Economic relations between India and Japan have vast potential for growth, given the obvious
complementarities that exist between the two Asian economies. Japan's interest in India is
increasing due to variety of reasons including India's huge 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 is expected
to further accelerate growth of trade, economic and commercial relations between the two
countries.
In FY 2013-14, Japan-India bilateral trade reached $16.31 billion, which is
11.89% lower than $18.51 billion in the previous fiscal year. The fall in the
total trade is mainly due to reduction in Japanese exports by 23.53%.
However, Indias exports have risen by 4.36% in 2013-14. The share of the
India-Japan bilateral trade has been hovering around 1% of Japan's total
foreign trade, while it was in the range of 2.2 to 2.5% of India's total trade in
the last couple of years. Total bilateral trade was US$ 12.11 billion during
April-December 2014.
Government Initiatives

India and Japan have a bilateral swap arrangement (BSA) in place that enables both countries to
swap their local currencies against the US dollar for an amount up to US$ 3 billion.
Indian IT outsourcing firms may finally be able to tap Japans US$ 108-billion IT services
market.
India mainly exports gems and jewellery, marine products, minerals and textile products to
Japan. Exports could be increased substantially as Japan has very low import duties on most
goods
India imports machinery, transport equipment, electronic goods, chemicals and metal products
from Japan.
Japan Bank for International Cooperation (JBIC) has signed an export credit line with
India's ICICI Bank to finance Indian imports of machinery, equipment and services from
Japan.
Cooperation in high-technology areas and the building of a knowledge economy through
transfer of technology. Japan can become our preferred partner in areas of established
Japanese competence such as energy efficient technologies, power generation and
distribution, including development of ultra-mega projects based on super critical technology,
and in the development of new and renewable sources of energy, including clean coal, solar
and nuclear energy.
The early finalisation of a Comprehensive Economic Partnership Agreement is high on the
list of our priorities. This will broaden our trade basket and enhance reciprocal investments. It
will provide economies of scale and allow India to serve as a global manufacturing hub for
the Japanese industry. The Agreement should promote further export of our goods and
services into Japan through the removal of tariff and non-tariff barriers. I would like to once
again state that the negotiation of a Comprehensive Economic Partnership Agreement with
Japan remains very high priority for the Government of India.
Upgrading of Indias infrastructure through more effective use of public-private
partnerships and joint ventures offers yet another area of exciting opportunities in the future.

 For greater cooperation in the fields of skill development, education and advanced research
and development through more intensive exchanges between our universities and institutions,
we should establish greater connectivities, both physical and intellectual, to underpin deeper
engagement between our two countries.
Working towards an integrated Asian Economic Community should be a common
endeavour of both India and Japan. Our Look East policy and Japans vision for the
integration of the Asia-Pacific provide a meeting of minds which can be translated into
concrete initiatives. The newly established Economic Research Institute for ASEAN and East
Asia is ideally suited to contribute to the finalization of a Comprehensive Economic
Partnership in East Asia among the EAS participants.
The relationship between India and Japan transcends the economic domain. Our two
countries understand the language of democracy and rule of law.We share the common values
of freedom, an open society and a free market economy. We share close civilisational links,
and believe in the Asian approach to problem-solving and wealth creation. We wish to learn
from the Japanese style of management and the premium it places on humane qualities and
traditions.

During the late 19th and early 20th centuries, Japan became a regional
power that was able to defeat the forces of both China and Russia. It
occupied Korea, Formosa (Taiwan), and southern Sakhalin Island. In 193132 Japan occupied Manchuria, and in 1937 it

attacked on China. Japan

attacked US forces in 1941 - triggering America's entry into World War II and soon occupied much of East and Southeast Asia. After its defeat in
World War II, Japan recovered to become an economic power and an ally
(friend) of the US. Japan's economy experienced a major slowdown
starting in the 1990s, but the country remains an economic power. In
March 2011, Japan's strongest-ever earthquake, and an accompanying
tsunami, devastated the northeast part of Honshu island, killed thousands,

and damaged several nuclear power plants. Prime Minister Shinzo ABE
was reelected In 2012, and has since embarked on ambitious economic
and security reforms to improve Japan's economy and bolster the
country's international standing.
Economic Overview
In the years following World War II, government-industry cooperation, a
strong work ethic, mastery of high technology, helped Japan to developed
as an advanced economy. Two notable characteristics of the post-war
economy were the close interlocking structures of manufacturers,
suppliers, and distributors, known as keiretsu, and the guarantee of
lifetime employment for a substantial portion of the urban labor force.
Both features are now eroding under the dual pressures of global
competition and domestic demographic change. Scarce in many natural
resources, Japan has long been dependent on imported raw materials.
Since the complete shutdown of Japans nuclear reactors after the
earthquake and tsunami disaster in 2011, Japan's industrial sector has
become even more dependent than it was previously on imported fossil
fuels. A small agricultural sector is highly subsidized and protected, with
crop yields among the highest in the world. While self-sufficient in rice
production, Japan imports about 60% of its food on a caloric basis. For
three decades, overall real economic growth had been impressive - a 10%
average in the 1960s, a 5% average in the 1970s, and a 4% average in
the 1980s. Modest economic growth continued after 2000, but the
economy has fallen into recession four times since 2008. Government
stimulus spending helped the economy recover in late 2009 and 2010, but
the economy contracted again in 2011 as the massive 9.0 magnitude
earthquake and the ensuing tsunami in March of that year disrupted
manufacturing. The economy has largely recovered in the four years since
the disaster, although reconstruction in the affected Tohoku region has

lagged, in part due to a shortage of labor in the construction sector. Japan

in 2014 stood as the fourth-largest economy in the world after first-place
China, which surpassed Japan in 2001, and third-place India, which edged
out Japan in 2012. While seeking to stimulate and reform the economy,
the government must also devise a strategy for reining in Japan's huge
government debt, which amounts to more than 230% of GDP. To help raise
government revenue, Japan adopted legislation in 2012 to gradually raise
the consumption tax rate to 10% by 2015, beginning with a hike from 5%
to 8% implemented in April 2014. That increase had a contractionary
effect on GDP, however, so PM Abe in late 2014 decided to postpone the
final phase of the increase until April 2017 to give the economy more time
to recover. low birthrate and an aging, shrinking population - pose major
long-term challenges for the economy.
agriculture: 1.2%
industry: 24.5%
services: 74.3% (2013 est.)
Agriculture - products:
vegetables, rice, fish, poultry, fruit, dairy products, pork, beef, flowers, potatoes/taros/yams,
sugar cane, tea, legumes, wheat and barley
Industries:
among world's largest and most technologically advanced producers of motor vehicles, electronic
equipment, machine tools, steel and nonferrous metals, ships, chemicals, textiles, processed
foods
$710.5 billion (2014 est.)
$714.9 billion (2013 est.)
country comparison to the world: 5
Exports - commodities:
motor vehicles 14.9%; iron and steel products 5.4%; semiconductors 5%; auto parts 4.8%; power
generating machinery 3.5%; plastic materials 3.3% (2014 est.)
Exports - partners:
US 18.9%, China 18.3%, South Korea 7.5%, Hong Kong 5.5%, Thailand 4.5% (2014)
Imports:
$811.9 billion (2014 est.)
$832.6 billion (2013 est.)

country comparison to the world: 5

Imports - commodities:
petroleum 16.1%; liquid natural gas 9.1%; clothing 3.8%; semiconductors 3.3%; coal 2.4%;
audio and visual apparatus 1.4% (2014 est.)
Imports - partners:
China 22.3%, US 9%, Australia 5.9%, Saudi Arabia 5.9%, UAE 5.1%, Qatar 4.1%, South Korea
4.1% (2014)
Prime Minister Shri Narendra Modi visited Japan from 30 August September 3, 2014 for the
9th Annual Summit Meeting with Prime Minster Shinzo Abe. The visit commenced in Kyoto.
PM Abe received PM Modi in Kyoto and hosted a private dinner. During the visit, the two sides
decided to upgrade the relationship to a Special Strategic and Global Partnership and launched
an IndiaJapan Investment Promotion Partnership under which Japan announced its intention to
invest in India approximately USD 35 billion over the next 5 years.