Both India and Japan are on a learning curve and understand each other far better than they used to a few years ago. For India-Japan relations, the next century has already begun, with the introduction of economic reforms in 1991. The solution to many of Indias problems, like its inadequate infrastructure, lies in cooperation with Japan.
This emerged at an India-Japan symposium on Vision 2000 and Beyond organised yesterday, which was observed as the Japan day during the Indian Engineering Trade Fair. Japan is the partner country this year. The most important speaker, finance minister P Chidambaram, failed to turn up and was replaced by commerce minister B B Ramaiah.
Thus the field was left open to former finance minister Manmohan Singh, who was repeatedly referred to as the architect of the Indian reforms that have brought the two countries closer, and whose theme was on how the two civil societies could go beyond their respective governments to fashion a closer understanding.
Singh recalled with gratitude how Japan had stood by India and disbursed aid quickly, before multilateral agencies, during the countrys payment crisis which brought on the reforms. India for its part had used this help well by fashioning one of the most successful adjustment programmes with the least social tension.
In suggesting cooperation beyond government action, Singh called for a jointly sponsored management institute which would familiarise Indians with the Japanese business culture which is so successful in assimilation and adoption of technology and management of technological upgradation. He also sought for Indians an insight into the wonderful work the Japanese have done in the field of pollution control, highlighted by the contrast between pollution-free Tokyo and Indian cities.
Japanese technology and capital can produce a collaborative design to conserve water resources, which, Singh said, would become the scarcest commodity in the 21st century. Japan had set new standards in conservation by reducing the income elasticity of demand for energy to almost zero. More conventionally, Japanese industrys help could be sought to add 20,000 mw of generating capacity to meet Indias energy needs. The Japanese learning process was highlighted by Isamu Miyazaki, former minister of state for economic planning, who said that Japan was fashioning a much more substantive market economy that was different from the old capitalism. Five years of economic stagnation brought about by the collapse of the bubble economy has highlighted the need for reform, particularly in an era when national borders tend to disappear from country after country, thus intensifying mega competition.
Reform was needed so that rising incomes could give a better quality of life, reform in public works financing for a safer infrastructure (the need for this was highlighted by the earthquake destruction) and meet the needs of an ageing population. While large-scale manufacturing had been deregulated, financial sector, social security and educational reform were the agenda for tomorrow.
A Asrani, former Indian ambassador to Tokyo, said he envied his successor who has the current reforms to flaunt whereas Asrani had only tea and sympathy to offer . He warned that India should not take high Japanese Official Develop- ment Assistance for granted as the increasing Japanese social security needs were bound to make them aid-weary soon. Asrani saw positive signs in the visit in 1995 by Hashimoto, the MITI minister at the time who is now the Prime Minister, and the starting of two direct flights by Japanese airlines.
He saw signs of the beginning of a non-official dialogue in politics and security and suggested that the new upsurge in relations be suitably climaxed by a visit by the imperial couple.
Maruti Udyog managing director R C Bhargava presented a case study of the most successful India-Japan collaboration exercise which in the problems that it has faced in the last two years also highlighted what could go wrong. Maruti succeeded as it had a clear objective to modernise the automobile sector and placed total trust and confidence in the Japanese, with nil government interference.
This had led to effective technology transfer, on-the-job learning and introduction of the Japanese work ethic which had attributes like a common uniform, open plan offices and a spirit of teamwork, all leading to high productivity.
The problems of the last two years had occurred because some of these old strengths had diminished with some blurring of roles and loss of confidence in the Japanese. Bank of Tokyo-Mitsubishi deputy-president K Yoshizawa highlighted the task ahead by comparing the time it takes to clear an import cargo in India (2-3 weeks) with that in Thailand (5-7 days).
He also called for a single shop agency to deal with foreign investment proposals like the Malaysian Investment Development Authority which in turn interacts with a state-level economic development corporation. The Japanese find this very useful, he added.
Yoshizawa contrasted the attitude of Indians and Japanese by referring to a recent study which said that 71 per cent of Indians thought that Japan was the most important country, with the US coming second with a 54 per cent score, whereas only 1 per cent of Japanese considered India very important to them. But the hope was that no discussion in Japan on overseas investment today is complete without a reference to India.
