Japan-India Strenghten Bilateral Ties; Pledge Investments, Energy Security and Free Trade

Posted by Reading Time: 2 minutes


Oct. 22 – Enroute to the Asia-Europe summit to be held in Beijing later this week, Indian prime Minister Manmohan Singh is visiting his Japanese counterpart Taro Aso. The two countries are seeking ways to deepen investments in defence, science and technology and energy security. Both also hope to sign a free trade agreement by the end of this year, boosting bilateral trade to US$20 billion by 2010. Ties between the two nations are already strong, with approximately 30 percent of all of Japan's foreign aid being directed towards India.

Japan will aid India with a US$4.5billion soft loan (the biggest-ever amount Tokyo has provided for a project overseas) to improve the 1468-km Mumbai-Delhi Industrial Corridor project. Manmohan Singh also encouraged Japan to grab a piece of India's nuclear pie, following opening up of the lucrative energy sector. Talks between India and Japan have recently been stalled by tariff negotiations and Japan's tight regulations on generic Indian drugs.

Critical to political and economic stability in the region, Japan -India ties are at an all time high and further bouyed by Japan the only nation to have suffered an atomic attack, backing India's landmark nuclear deal with the US earlier this month. Earlier in the year, Japan and India signed a curreny swap deal which enabled both countries to swap yen or rupee against the U.S. dollar for up to $3 billion.

In a statement to the Times of India before his departure for Japan on Tuesday morning, the PM said: "Strong India-Japan relations will play a significant role in the emerging Asian security architecture and will contribute to the peace, stability and prosperity of Asia and the world."