Japan intents to realize 3.5 trillion yen of public & private investment & finance in India

Prime Minister Narendra Modi and Prime Minister Shinzo Abe atm a eeting in Tokyo pledged to realize the full potential of India - Japan Strategic and Global Partnership for continuing progress and prosperity for their people and for advancing peace, stability and prosperity in Asia and the world. Elevating the relationship to a Special Strategic and Global Partnership, they called their meeting the dawn of a new era in India - Japan relations.

They stressed their shared interests, including with respect to energy security, in a stable and peaceful Middle East, West Asia and the Gulf regions. They expressed their deep concern over continuing turmoil and instability in the region, from diverse sources of conflict, which has had tragic and devastating impact on countries and people in the region. Ending the region`s conflicts, combating terrorism and resolving outstanding issues, they shared, was of paramount importance, not just for the people of the region, but also to the world. They welcomed negotiations between P5+1 and Iran over the Iranian nuclear issue and urged all parties to show political will and seek common ground while accommodating differences.

Recognising the critical dependence of their economies on imported energy sources and their vulnerability to supply shocks,Mr. Modi & Mr. Abe affirmed their intention to further strengthen energy cooperation through the India–Japan Energy Dialogue. They shared the intention that India and Japan would explore a higher level of strategic collaboration in the global oil and natural gas market, including through joint procurement of LNG, upstream development of oil and gas, and joint efforts to promote flexible LNG markets, including through relaxation of destination clauses. The two Prime Ministers also welcomed enhanced cooperation on utilizing highly efficient and environmentally-friendly coal-fired power generation technology and progress on cooperation in Clean Coal Technology (CCT).

India and Japan affirmed the importance of civil nuclear cooperation between the two countries and welcomed the significant progress in negotiations on the Agreement for Cooperation in the Peaceful Uses of Nuclear Energy. They directed their officials to further accelerate the negotiations with a view to concluding the Agreement at an early date, and strengthen the two countries’ partnership in non-proliferation and nuclear safety.

An India–Japan Investment Promotion Partnership was announced under which:

1. The two Prime Ministers decided to set a target of doubling Japan’s foreign direct investment and the number of Japanese companies in India within five years as an objective to be jointly achieved. They also decided to work closely towards further expanding bilateral trade relationship to the next stage.

2. Prime Minister Abe expressed his intention to realize 3.5 trillion yen of public and private investment and financing from Japan, including Overseas Development Assistance (ODA), to India in five years, to finance appropriate public and private projects of mutual interest including in the areas of next generation infrastructure, connectivity, transport systems, Smart Cities, rejuvenation of Ganga and other rivers, manufacturing, clean energy, skill development, water security, food processing and agro industry, agricultural cold chain, and rural development. In this connection, Prime Minister Abe pledged ODA loan of 50 billion yen to India Infrastructure Finance Company Limited (IIFCL) for a public-private partnership infrastructure project in India.

3. The two Prime Ministers welcomed the public-private initiatives between the two countries to set up Electronics Industrial Parks in India. They also shared the intention to develop "Japan Industrial Townships” and other industrial townships with investment incentives for companies would not be lower than under the prevailing policy framework such as Special Economic Zone (SEZ), National Investment and Manufacturing Zone (NIMZ).

4. The two Prime Ministers directed their officials to work out an appropriate mix of financing mechanisms, including public-private partnership, and terms for utilization of public funds, taking into account the nature of the projects, developmental priorities, procurement policies, level of industrial and technological capacities and skills available locally. They decided to explore ways to enhance Japanese and Indian participation in appropriate infrastructure projects in India.