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Japanese Prime Minister Sanae Takaichi’s first official visit to India since assuming office witnessed the 16th India-Japan Annual Summit.
The summit took place at a time when governments across the world are reassessing their priorities as supply chains continue to face disruptions,
For both New Delhi and Tokyo, these developments have reinforced the importance of building resilient partnerships while expanding cooperation in emerging technologies and strategic industries.
Against this backdrop, Prime Minister Narendra Modi and his Japanese counterpart used the summit to announce several new initiatives.
Takaichi arrived in New Delhi on the evening of July 1 and was received by Minister of State Jitendra Singh, while the Ministry of External Affairs described the visit as another important step in strengthening the India-Japan Special Strategic and Global Partnership.
On Thursday, she was accorded a ceremonial welcome, including
a guard of honour at Rashtrapati Bhavan, before proceeding to Hyderabad House for bilateral and delegation-level discussions with Modi.
The leaders later participated in the India-Japan Joint Economic Forum alongside senior government officials and representatives from industry, where many of the summit’s commercial announcements were formally unveiled.
More than 100 business agreements
One of the biggest announcements came from Japanese industry,
which committed approximately $12.5 billion (around ¥2 trillion) in investments into India while business leaders announced 129 memorandums of understanding (MoUs) at the India-Japan Joint Economic Forum.
Addressing the gathering in the presence of both prime ministers, Japan External Trade Organization (JETRO) Chairman and CEO Ishiguro Norihiko said, “Japan-India economic relations are now at an unprecedented high level. According to JETRO’s survey, more than 80 per cent of the Japanese companies operating in India are planning to expand their local business going forward.”
The new announcements build upon commitments already made under the India-Japan “Joint Vision for the Next Decade.” Last year, Japan pledged to mobilise ¥10 trillion — equivalent to roughly $68 billion — in private-sector investment into India over a ten-year period.
During this year’s summit, Takaichi reiterated the objective of mobilising that investment while both governments also sought to expand bilateral trade beyond its present level.
Trade between the two countries reached approximately $27.5 billion during FY2025-26, while Japanese investment into India amounted to $3.2 billion between April and December 2025.
Around 1,400 Japanese companies currently operate in India, with nearly half of them engaged in manufacturing activities, illustrating the country’s importance within Japan’s broader Indo-Pacific economic strategy.
More than 150 representatives from Japanese companies travelled to India as part of the official delegation to participate in the India-Japan Joint Economic Forum.
Speaking at the forum, Modi announced a new initiative intended to improve engagement between Japanese investors and the Indian government.
“Today, I want to share with all of you that my office, that is, the PMO, will organise a dedicated Japan Business Week. In this, senior officers of the PMO will engage in discussions with you. They will discuss openly with you to understand your problems and to enhance the ease of doing business.”
He said the initiative would enable senior officials from the Prime Minister’s Office to directly engage with Japanese companies to understand operational challenges and explore measures to improve the investment environment.
Modi also used the occasion to highlight India’s recent policy reforms aimed at making the country a more attractive investment destination.
“Recently, we did next-gen reforms in taxation, governance and ease of doing business. We are opening every sector to the private sector, and in many sectors, we are providing incentives, and I believe you too can benefit from them. For this very reason, for the last four years in a row, the survey of the Japan Bank for International Cooperation shows that India has been the Most Promising Destination for Japanese businesses.”
He also noted that international trade continued to face multiple challenges because of weakening demand and disruptions to global supply chains, particularly amid the recent crisis in West Asia.
“Today the economic world is suffering from hindrances in the supply chain, uncertainty in trade and a fall in global demand. But as it is said, ‘When the going gets tough, the tough get going.’ India is the world’s fastest-growing major economy. India’s GDP growth was 7.7 per cent in the last financial year. Besides, over the last 12 years, we have been transforming our economic DNA by pursuing the philosophy of Kaizen, i.e. continuous improvement in India.”
Modi also pointed to the long-standing presence of Japanese companies in India and described the bilateral economic relationship as one that had consistently expanded across multiple industries over several decades.
“Several companies here have had ties with India for a long time now, some for more than 100 years. I extend my heartiest greetings to the new friends joining this forum for being a part of the India-Japan success story. India and Japan share special ties. There are several bright examples of the success of our economic partnership. We inaugurated Maruti Suzuki’s Vehicle Manufacturing Facility at Kharkhoda in Haryana. Today, two-thirds of Suzuki’s cars worldwide are made in India and are being exported to over 100 countries.”
The inauguration of Maruti Suzuki’s fourth vehicle manufacturing facility by both leaders at Kharkhoda in Haryana became one of the symbolic moments of the visit.
Expanding on India’s manufacturing capabilities, Modi said Japanese companies were increasingly using India not only as a production base for the domestic market but also as an export hub serving countries around the world.
Referring to Japanese motorcycle manufacturers, he added, “I have been told that PM Takaichi is fond of motorbikes. We are delighted that Yamaha, Kawasaki and Honda bikes are exported across the globe from India. Similarly, air conditioners, power grid equipment, precision manufacturing or medical technology when Japan’s expertise and investment combine with India’s speed and scale, the entire world benefits.”
The entire framework builds upon initiatives launched during Modi’s visit to Tokyo last year.
Semiconductors, rare earth: Centrepieces of the summit
While investment announcements dominated the business forum, one of the summit’s most consequential outcomes was the decision by India and Japan to institutionalise cooperation on economic security through a comprehensive Joint Roadmap for Economic Security.
With supply chains increasingly vulnerable, New Delhi and Tokyo agreed to deepen cooperation in sectors regarded as critical to future economic growth and technological competitiveness.
Rather than focusing solely on expanding trade, the roadmap aims to strengthen the foundations of industrial cooperation by reducing dependence on concentrated supply chains and encouraging joint development of strategic technologies.
Among its principal pillars is cooperation in semiconductors, where the two governments agreed to pursue co-investment in resilient chip supply chains while creating reciprocal material buffers designed to cushion sudden market disruptions.
Another important component centres on quantum computing and advanced materials. The framework envisages collaborative research clusters, closer scientific cooperation and shared intellectual property arrangements to accelerate innovation in next-generation technologies.
Critical minerals also featured prominently. India and Japan agreed to strengthen cooperation on supply routes and processing infrastructure to reduce vulnerabilities associated with single-source dependence in the rare-earths market.
The summit also reaffirmed cooperation in pharmaceuticals, clean energy and information and communications technology (ICT), sectors that both governments had previously identified as priorities during Modi’s visit to Tokyo.
The latest agreements therefore build upon a series of initiatives already underway, including the India-Japan Private-Sector Dialogue on Economic Security between Japan’s Keidanren and the Confederation of Indian Industry (CII), as well as the Memorandum of Cooperation signed between India’s Ministry of Mines and Japan’s Ministry of Economy, Trade and Industry (METI).
Several industrial projects were also highlighted as examples of the expanding partnership. Fujifilm will collaborate on a semiconductor materials plant, Suzuki will participate in a major biogas initiative in India, while Japanese and Indian artificial intelligence startups are expected to establish application-development partnerships.
The discussions also acknowledged the importance of securing critical mineral supply chains. Draft details associated with the summit noted concerns over China’s export restrictions on rare earth elements, with both countries agreeing to strengthen cooperation on securing essential resources and improving the resilience of energy supplies through joint stockpiling initiatives.
AI, robotics and next-gen tech
India and Japan issued a joint statement on AI cooperation aimed at expanding collaboration in research, innovation and industrial applications.
Building upon the earlier Japan-India AI Cooperation Initiative, the two countries agreed to deepen cooperation in areas including large language models (LLMs), startup support, capacity building, joint research and development, and the creation of what both governments described as a trustworthy AI ecosystem.
The draft joint statement stated that “promoting innovation, including AI, is extremely important in further expanding the foundation for cooperation.”
Both governments are placing greater emphasis on industrial applications of artificial intelligence, combining Japanese strengths in precision engineering, robotics and automation with India’s rapidly expanding software ecosystem.
The objective is to integrate Japanese hardware expertise with India’s software capabilities, enabling both countries to strengthen their competitiveness in advanced manufacturing while creating new opportunities for startups and technology companies.
Defence cooperation enters a new phase
One of the most significant announcements was the agreement on what Modi described as
the first-ever joint military hardware co-development project between India and Japan.
The agreement is expected to combine Japan’s advanced expertise in naval technologies, electronics and metallurgy with India’s defence manufacturing capabilities under the Atmanirbhar Bharat initiative.
For Japan, the arrangement offers opportunities to diversify elements of its defence industrial base through cooperation with India, while India stands to gain access to advanced manufacturing expertise and defence technologies.
The summit also reviewed proposals involving stealth-enhancing radar antenna technology for Indian naval platforms, alongside broader cooperation in maritime security. Recognising the evolving regional security environment, both governments reaffirmed their commitment to strengthening cooperation across the Indo-Pacific.
The joint discussions also welcomed Japan’s revision of its defence-equipment transfer guidelines and confirmed that a Japan-India Foreign and Defence Ministerial (“2+2”) Meeting would be held before the end of the year.
Both sides
reiterated support for the vision of a Free and Open Indo-Pacific, reflecting shared concerns over maintaining secure sea lanes of communication across the Indian Ocean and the western Pacific.
Before arriving in India, Takaichi had outlined Japan’s strategic priorities by stating, “India, along with Japan, is one of Asia’s leading democracies and shares responsibility to maintain peace and stability in the Indo-Pacific region… I look forward to having thorough discussions with Prime Minister Modi on efforts to realise a Free and Open Indo-Pacific, including cooperation through the Quad framework.”
The defence agenda unfolded against significant changes in Japan’s own security posture.
Takaichi has increased Japan’s defence expenditure to roughly two per cent of GDP, ended the country’s longstanding restrictions on lethal weapons exports through policy changes introduced in April, and has advocated revising Article 9 [the famous “peace clause” that renounces war as a sovereign right] of Japan’s Constitution before the end of the year.
Clean energy, rural development and India’s Northeast
The leaders announced an ambitious India-Japan Bio-Gas Initiative aimed at establishing 1,000 biogas and organic fertiliser plants across rural India. The initiative seeks to expand domestic clean-energy production while reducing dependence on imported chemical fertilisers and strengthening rural livelihoods.
The project also complements broader bilateral cooperation on clean energy and energy security, both of which featured prominently in the economic security framework unveiled during the summit.
Regional development also remained high on the agenda through the India-Japan Act East Forum. Japan remains the only foreign country with a dedicated institutional mechanism focused specifically on supporting development in India’s strategically significant Northeast.
Infrastructure projects involving roads, bridges and urban water systems across northeastern states received continued support.
The leaders also reviewed progress on an existing initiative designed to provide skill development and employment opportunities in Japan for 5,000 young people from the Northeast over a five-year period.
For Japan, the region represents an important geographical bridge connecting South Asia with Southeast Asia and aligns closely with its broader Free and Open Indo-Pacific strategy.
The discussions also explored strengthening industrial connectivity between the Bay of Bengal and the Northeast through improved logistics and value-chain integration.
High-speed rail remains a flagship project
Infrastructure cooperation continued to feature prominently during the summit through the Mumbai-Ahmedabad High-Speed Rail corridor. Often regarded as the flagship symbol of India-Japan infrastructure cooperation, the project remains one of the largest bilateral initiatives undertaken by the two countries.
The first 508-kilometre section is currently targeted for completion in 2027. Approximately 81 per cent of the project’s financing is being provided through a Japan International Cooperation Agency (JICA) loan.
The project has an estimated cost of around $17 billion, although delays and higher land-acquisition expenses have increased financial requirements.
The draft joint statement also expressed support for introducing JR East’s next-generation E10-series Shinkansen technology in India, signalling interest in expanding collaboration on future high-speed rail projects.
Preparing for the next chapter of India-Japan ties
External Affairs Ministry spokesperson Randhir Jaiswal confirmed that India and Japan had finalised an official calendar of activities
to commemorate the 75th anniversary of diplomatic relations in 2027.
The anniversary is expected to provide another opportunity to deepen political, economic, technological and cultural engagement between the two countries.
What began decades ago with infrastructure cooperation and development assistance has steadily evolved into a multifaceted partnership encompassing manufacturing, advanced technologies, clean energy, defence, maritime security, artificial intelligence, critical minerals, supply-chain resilience and regional connectivity.
The announcement of approximately $12.5 billion in fresh investments, 129 MoUs demonstrated that businesses are expected to play a central role in translating government initiatives into long-term economic partnerships.
At the same time, the agreements on semiconductors, quantum computing, critical minerals, artificial intelligence and defence manufacturing indicate that India and Japan are broadening cooperation into sectors likely to shape the global economy over the coming decades.
With more than 70 dialogue mechanisms already operating between the two countries and preparations now underway for the 75th anniversary of diplomatic relations next year, Takaichi’s first official visit to India illustrated the direction in which the bilateral relationship is evolving.
With inputs from agencies
