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Shri Kamal Nath, Union Minister of Commerce & Industry, has said that there is a vast potential for higher levels of Japanese investment in India in a variety of sectors like Infrastructure, Telecom, Power and Construction where Japanese businessmen can make use of the growing opportunities in India. Inaugurating the “Destination India Seminar”, organised jointly by the Federation of Indian Chambers of Commerce & Industry (FICCI) and the Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce & Industry and the Japan Chamber of Commerce & Industry (JCCI), in Tokyo today, Shri Kamal Nath pointed out that the FDI policy in India in general was very liberal, transparent and investor-friendly with 100% foreign direct investment (FDI) allowed under the automatic route for almost all major sectors, including in the construction sector, opening huge opportunities for Japanese business. “I am aware of the fact that India is one of the largest ODA* recipients from Japan. However, in the changed context of our desire for seeking a new economic partnership, it is important that we shift the emphasis of India-Japan relationship from an ODA-based relationship to an FDI-based partnership. It is no long aid that India seeks, but trade. India’s exports were 80 billion dollars last year, and our imports 105 billion dollars. But only a fraction of this 185 billion dollar international engagement is with Japan”, the Minister observed.
Expressing disappointment over the fact that India’s trade with Japan had remained stagnant for long, Shri Kamal Nath invited Japan to invest in India’s Special Economic Zones (SEZs), which could spur an increase in trade between the two countries.
Reiterating India’s commitments to economic reforms to stimulate growth, investment and employment, Shri Kamal Nath noted that the actual inflow of investment of Japan into India had not even touched US $ 2 billion and 62% of it was concentrated in the automobile sector. A number of successful Japanese investments are already there such as Suzuki-Maruti, Hero-Hondo and Toyoto-Kirloskar joint ventures in the area of automobiles and Mitsubishi in the chemicals sector. These success stories could be replicated manifold to push up India’s investment and trade ties with Japan, Shri Kamal Nath said. “As those who have already invested in India have experienced, investing in my country has been a profitable preposition. A survey of foreign companies conducted by the Federation of Indian Chambers of Commerce & Industry in 2004 showed that 77% of foreign companies in India were making profits, while another 9% were breaking even. The findings in respect of Japanese companies in the sample were even better, with 80% making profits”, he added.
* Overseas Development Assistance
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