India calls for better trade ties with Japan

India today said it is seeking a new economic partnership with Japan, with a shift from an Overseas Development Assistance based relationship to a Foreign Direct Investment based partnership.

"I am aware of the fact that India is one of the largest ODA recipients from Japan. It is no longer aid that India seeks, but trade. India's exports were $80 billion last year, and our imports $105 billion. But only a fraction of this $185 billion international engagement is with Japan," Commerce and Industry Minister Kamal Nath said at a "Destination India Seminar", organised by the Federation of Indian Chambers of Commerce & Industry, Commerce & Industry Ministry and the Japan Chamber of Commerce & Industry, in Tokyo.

Nath noted that the actual inflow of investment of Japan into India had not even touched $ 2 billion and 62 per cent of it was concentrated in the automobile sector.

Giving examples of successful Japanese investments such as Suzuki-Maruti, Hero-Honda and Toyoto-Kirloskar joint ventures in the area of automobiles and Mitsubishi in the chemicals sector, Nath said these success stories could be replicated manifold to push up India's investment and trade ties with Japan.

"As those who have already invested in India have experienced, investing in my country has been a profitable preposition.

"A survey of foreign companies conducted by Ficci in 2004 showed that 77 per cent of foreign companies in India were making profits while another 9 per cent were breaking even. The findings in respect of Japanese companies in the sample were even better, with 80 per cent making profits," he added.

Nath said there is a vast potential for higher levels of Japanese investment in India in a variety of sectors like infrastructure, telecom, power and construction where Japanese businessmen can make use of the growing opportunities in India.