Suggesting a localised investment approach to Japan to yield better results, Foreign Secretary S Jaishankar on Thursday asked Japanese companies to have expectations that are grounded in the Indian reality.
“India is India. I would not necessarily defend everything in India which goes right or wrong. But it is important for Japanese companies to understand that their expectations must be grounded in the Indian reality. Surely Indian reality can be improved. They (Japanese companies) should not expect that they will get responses that they have experienced in other geographies. I think a much more educated aware, localised investment approach perhaps would yield greater results in India,” Jaishankar said at a seminar organised by RIS.
His comments are significant given that Japanese companies like Suzuki Motors and Toyota have had labour-related unrest in past few years leading to temporary shutting down of Toyota plants near Bangalore as well as bitter fights between the management and employees. Appreciating Japan’s contribution in India’s growth, Jaishankar said, “In India’s growth story, Japan has a very unique role. Japan is the one country, I would say has changed Indian mindset in different points of time. I am not sure even today whether Japanese understand that what Maruti did to Indian mindset. Entire generation grew up with that change, then the next change was with metro rail project. Today we expect that High Speed Railway (HSR) project would emerge as the third phase of the changing mindset.”
Jaishankar also admitted that India has not been able to fully utilise the India-Japan Comprehensive Economic Partnership Agreement (CEPA), which was signed in 2011. Referring to some Japanese projects, he said high speed railway (HSR) project and Civil Nuclear Agreement, if approved, clearly have potential to improve demand which will increase trade between the two countries. Asserting that investment sentiments was much stronger today in India, the Foreign Secretary said, “We have went out of way to make special carve-out for Japan including business visa arrangement which is unique. It is important that today we aggressively push investments.”
He also pointed out that the last five years have not been economically good, globally. The bilateral trade between the countries stood at USD 14.51 billion in 2015-16. India received USD 20.96 billion FDI from Japan during April 2000 and March 2016.