Foreword:

India’s business and commercial ties with Japan have been as enduring as they have been deep. Japanese companies were among the first foreign investors in India. The world’s largest two-wheeler manufacturer, and the world’s lowest-cost small car manufacturers, both collaborative ventures between Indian and Japanese companies, are powerful success symbols of this prosperous association.

These are but two examples. There are several more, in diverse fields. And the good thing is that these are all moving on an upward trajectory. Indo-Japanese businesses in India are on a major expansion drive, and the future promises to be even brighter.

I am pleased that the India Brand Equity Foundation has undertaken this report on “Proven Strategies: Successful Japanese Companies in India”.This report should serve as a strong proof point for Japanese companies looking at globally competitive investment destinations. The companies profiled here are a small sample of the 300-plus Japanese businesses that are thriving
in India, today. I invite more Japanese companies to put their faith in the world’s fastest growing free market democracy. I assure you – it will be a profitable bet!

                                                             Kamal Nath
                                                             Minister of Commerce & Industry
                                                             Government of India

India - Japan: Economic and Commercial Relations

A robust bilateral relationship between India and Japan holds the key to the future of a prosperous Asian continent.

Economic cooperation between India and Japan took off in 1984, after the visit of Y. Nakasone, then Prime Minister of Japan. Since then, there have been a large quantity of Foreign Direct Investment (FDI) in India with Suzuki, Yamaha, Toyota, Honda and others entering the Indian market.

India’s large domestic market has been the main factor for investments by Japanese companies. The majority of investments are in traditional fields like automobiles and auto parts. However, some companies have invested in businesses like pharmaceuticals (EISAI), health drinks (Yakuruto), pulp (Nihon Koso) and rice processing (Yanmar).

Japanese SMEs are also investing in India. Japan and India share a common vision for the world. This is aptly illustrated by the fact that there has been an increase in the number of joint declarations, delegation visits and other business events between the two countries.

Trade & investment relations between India and Japan are growing stronger.This can be explained by the following facts:
• Japan is a relatively labour-scarce, capital
abundant country that complements India’s rich spectrum of human capital.
• India’s prowess in the software sector lends synergy to Japan’s excellence in the hardware sector.
• India’s abundance of raw-materials and minerals matches well with Japan’s capabilities in technology and capital to produce knowledge intensive manufactured goods.

This is further substantiated by the fact that Japan is among India’s top five trading partners. Total trade between India and Japan was close to US$ 5 billion during 2004-2005.

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