TOKYO -- The summit meeting between Japanese Prime Minister Shinzo Abe and his Indian counterpart Narendra Modi on Oct. 29 indicated a growing willingness for the two countries to accelerate their cooperation in information technology projects, and Tokyo's bid to get closer to New Delhi in the face of growing national security threats from China.
"Japan and India complement each other in the business field. I expect a global innovation to take place through our exchanges in startups and IT human resources," Prime Minister Abe told a joint press conference after the summit.
The two leaders agreed to expand joint investments in third countries in regions such as Africa, and Japan's provision of loans totaling some 316 billion yen for seven infrastructure development projects in India including a high-speed train link between Mumbai and Ahmedabad in the western part of the country. Japan and India will introduce a pilot project to speed up the screening of patent applications from fiscal 2019. They will also resume a currency swap agreement to help each other during times of currency crises with a historic high cap of $75 billion or about 8.4 trillion yen.
Another focus of their business cooperation is the information technology industry. India's IT talents have made their way into top managerial positions at leading international IT corporations such as Microsoft and Google. With its rich human resources geared for software development, India is now home to research and development facilities of major German companies such as Bosch and Siemens.
As for Japanese entry into India, as many as 1,369 companies had set up there as of October 2017. They include major companies such as Sony and Panasonic, but the number of jobs they offer to local engineers is only in the hundreds -- far smaller than European and American employers hiring more than 10,000 local workers. Japanese companies tend to teach their own style of manufacturing on smaller scales to Indian workers, unlike their European and American competitors who just buy up local corporations and run them from the top, says a senior Ministry of Economy, Trade and Industry official.
Japanese trade minister Hiroshige Seko says Japan and India can help each other because "India has strength in software and Japan has an edge in hardware," expressing his willingness to support business cooperation between the two countries. A new hub will be set up in May in Bengaluru in southern India to foster cooperation between emerging, innovative Indian IT corporations and their Japanese partners, and Tokyo is ready to support such matchups.
--- Japan, India share worries about China's military, maritime expansion
Meanwhile, Tokyo and New Delhi also shares concerns about their common neighbor China and its military and maritime expansion. This recognition is the basis for rare hospitality shown by Prime Minister Abe to premier Modi in an apparent bid to counter Beijing through a stronger Japan-India partnership.
Prior to his summit with Modi, Abe met with Chinese President Xi Jinping in Beijing on Oct. 27 to agree on improving ties between Japan and China. But Tokyo and Beijing still have a tense relationship over national security issues including their confrontation over the Senkaku Islands in Japan's southernmost prefecture of Okinawa, for which China lays territorial claims.
"A strong India benefits Japan and a strong Japan benefits India," said Abe at the beginning of their summit meeting on Oct. 29. Modi said, "Without India-Japan cooperation, there will be no development in Asia into the next century." The two leaders thus played up their close ties.
One day before their meeting, Abe invited Modi to his holiday house in the central Japan prefecture of Yamanashi and they dined together. The Indian leader became the first foreign head of state to be given such treatment.
To be sure, China is an important business presence for both Japan and India. The country is the largest trading partner for the two countries. Yet both Tokyo and New Delhi have political troubles with China -- Japan over the Senkakus and India over their borders.
Abe and Modi agreed to start meetings between their ministers of foreign affairs and defense. The two sides also confirmed the start of negotiations to sign an acquisition and cross-servicing agreement between their defense forces. These developments indicate their efforts to strengthen cooperation in the security area.
A senior Japanese Foreign Ministry official explained that "inviting Modi right after (Prime Minister Abe's) visit to China is our message to China."
Abe also plans to visit Australia in November to meet with Prime Minister Scott Morrison. This is another attempt by Tokyo to maintain close ties with countries that it perceives as "sharing values" -- India, Australia and the U.S. -- while urging China to follow international norms such as the rule of law.
(Japanese original by Kenji Wada and Mikako Yokoyama, Business News Department, and Shinichi Akiyama, Political News Department)