Moneycontrol
Sep 14, 2017 03:04 PM IST | Source: Moneycontrol.com

Shinzo Abe in India: A look at India-Japan economic cooperation down the ages

Japanese Prime Minister Shinzo Abe’s visit to India will not only kick start the bullet train project, it will also advance the commercial ties between India and Japan in areas of defence and development projects.


Japanese Prime Minister Shinzo Abe’s visit to India will not only kick start the bullet train project, it will also advance the commercial ties between India and Japan in areas of defence and development projects.

Abe is scheduled to arrive in the country on Wednesday for a two-day visit for trade talks and an annual summit between the two countries.

On the plate is the much-hyped Bullet train project known as Mumbai-Ahmadabad High Speed Rail. Abe, along with PM Narendra Modi, will lay the foundation stone for the 508-km long rail project on Thursday in Ahmedabad.

Bullet Train

The bullet train project is expected to be completed within 2023, after which the train will be capable of running at the high speed of 350 km per hour.


Watch | India's Bullet Train Ambitions

The project, funded 80 percent by the Japan Investment Cooperation Agency (JICA) as a soft loan spread over 50 years at minimal interest rate, will reduce travel time between Mumbai and Ahmedabad from seven to two hours. The rest of the funding, amounting to Rs 9,800 crore, is borne by the Indian Railways, making the project one of its costliest.

For this project, the new Shinkansen Technology from Japan will come to India and be developed under Make in India scheme, as per Railway minister Piyush Goyal.

Other expected projects

Piyush Goyal has recently said that active interactions taking place between Indian and Japanese industries will expand and give way to more collaborations between the two countries in future.

“It is expected that many joint ventures will be formed in the time to come to take up manufacturing of various components including rolling stock,” he said.

India is also planning to strengthen its military ties with Japan along with sourcing defence equipment technologies which will be used to manufacture arms and amunitions under Make in India, the Financial Express reported.

As per the report, Japanese firms such as Mitsubishi Electric Corporation (manufactures drones and radars) and Mitsubashi Heavu Industries (ships and submarines) are expected to be a part of the delegation team arriving with their PM Shinzo Abe.

During the recent inauguration of DMIC Neemrana solar power project, a Japanese ambassador has reportedly stated Japan’s interest to invest in India’s energy sector and provide technological assistance.

Previous joint ventures

JICA has already extended financial assistance to India across sectors through Official Development Assistance or ODA loans.

Among key projects under Japan’s assistance is the gigantic plan of Dedicated Freight Corridors, with higher speed and capacity for freights, has been partly funded by JICA. The first portion of it, a 190-km double track route, will become operational between Ateli and Phulera next year.

Japan has also funded Delhi, Bengaluru, Chennai and Ahmedabad metro railway, many expressways and other road projects.

JICA has given ODA loans to the Delhi-Mumbai Industrial Corridor (DMIC) and is looking at Chennai-Bangalore Industrial corridor; both projects are a works in progress. The Delhi-Mumbai Corridor, planning to connect eight industrial cities in its four phases, is expected to be completed in 2040.

One of India’s largest river restoration projects—Yamuna Action Plan—is also a bilateral project between the two countries. The action plan to decrease the severe level of pollution in the Yamuna was partly funded by JICA. But even after the third phase of the project, Yamuna still remains stagnant and polluted. The government is working on a new plan.

JICA has also signed an agreement with Government of India to fund Water Resource Department (WRD) and allied departments for Rajasthan Water Sector Livelihood Improvement Project. The project focuses on irrigation, capacity building, and water management in the region where water resources are scarce but many people are dependent on agriculture.

The body has also funded a similar project in Andhra Pradesh. Additionally, it has given financial assistance in biodiversity and forest conservation programmes in Rajasthan.

Japan has also participated in a ‘Technical Cooperation’ mission to stimulate sustainable agriculture and irrigation development in Mizoram this year. It has extended its participation in the socio-economic development agenda of Indian government in the North East region and allowed ODA of about Rs 4000 crore for the first phase of North East Road Network Connectivity Improvement Project.

The economic cooperation between India and Japan was initiated back in 1958 and started with ODAs which have played a crucial role in the infrastructural development of India.
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