In brief
Japan is betting heavily on India to counter a shrinking domestic market and geopolitical pressures. Retail giants such as Uniqlo, Muji and Onitsuka Tiger have opened widely in Indian malls. Japanese banks are purchasing significant stakes in shadow lenders like Shriram Finance and Yes Bank, while Japan Inc leads India’s global capability centre network. Total investment reached $12.5bn under the July visit of PM Sanae Takaichi, surpassing the 10 trillion yen target. Yet the growth faces hurdles including bureaucratic delays and regulatory uncertainties.
India’s Commerce Minister Piyush Goyal led the largest business delegation to Japan last week to push deeper trade ties.
Japanese brands such as Uniqlo, Muji and Onitsuka Tiger are taking over Indian malls, while companies like Nitori and Lawson are also establishing a footprint.
In finance, MUFG Bank bought 20% of Shriram Finance for $4.4bn, and Sumitomo Mitsui credited Yes Bank with a 24% share.
Japan Inc now leads India’s global capability centre ecosystem, with over 100 firms launching offshore R&D and AI hubs.
Japanese investment surged to $12.5bn amid PM Sanae Takaichi’s July visit, surpassing the 10 trillion yen target and signalling a strategic pivot from China.
Despite this momentum, India faces regulatory hurdles and a slow‑moving bureaucracy that can stall projects like the bullet train, prompting Chinese state media to highlight contract enforcement gaps.
Experts argue that Japan’s ties with India are growing beyond diplomatic gestures into entrenched corporate collaboration, but challenges remain in aligning economic and political interests.
