Union Minister Piyush Goyal meets Nippon Paint Holdings’ Yuichiro Wakatsuki to explore stronger India-Japan cooperation in paints and coatings.
TOKYO: Union Commerce and Industry Minister Piyush Goyal concluded a four-day tour of Japan on August 27, leading the largest Indian business delegation ever to visit the country, over 200 representatives spanning steel and automotive to semiconductors and deep-tech startups. The itinerary moved deliberately from Tokyo’s policy corridors to Nagoya’s industrial heartland and finally to Osaka’s specialised manufacturing base, reflecting an attempt to reposition India as an integrated supply chain partner rather than merely a consumer market.
The visit produced no major signed agreements or quantified investment pledges. Instead, it functioned as what might be called a bottleneck-clearing exercise, with the most consequential outcome being a regulatory commitment rather than a capital announcement.
Tokyo: Policy and Patient Capital
In Tokyo, Goyal met Japan’s Minister of Economy, Trade and Industry Akazawa Ryosei and addressed Keidanren, Japan’s apex business federation representing over 1,500 corporations, on economic security and innovation. Roundtables with financial giants including MUFG, Mizuho, Nomura and the Development Bank of Japan focused on mobilising long-term capital for Indian infrastructure and digital ecosystems. Technology-focused meetings with Tokyo Electron, MinebeaMitsumi, Toshiba and Nippon Steel underscored the semiconductor and materials focus that would define much of the trip.
The BIS Breakthrough
The most significant tangible outcome was a firm commitment to overhaul Bureau of Indian Standards certification requirements for high-tech capital equipment, an issue raised directly by Tokyo Electron over delays in importing specialised fabrication machinery. Goyal announced instructions to the Commerce Ministry and BIS to draft an exemption framework within two months, offering flexibility across bulk, product, project or company-specific exemptions depending on investor needs. The Minister was explicit that this liberalisation would not extend to countries associated with predatory pricing, reserving the relief for trusted partners such as Japan.
Semicon 2.0’s International Debut
Goyal also used the visit to formally market Semicon 2.0 to Japanese investors, presenting data showing the initial $10 billion incentive package had already seeded roughly $19 billion in investments across 13 projects, including the Renesas-anchored CG Power facility in Sanand. Building on this, he confirmed Cabinet approval of Semicon 2.0’s ₹1,27,500 crore outlay, targeting an additional $50 billion in investment over the next eighteen months, with India’s first new fabrication plant expected to be commissioned in 2028.
Nagoya: Courting the SME Ecosystem
The Nagoya leg pivoted toward operational partnerships, with Goyal meeting Chukeiren Chairman Satoru Katsuno and the Nagoya Chamber of Commerce to press for sector-specific delegations to India. He issued a four-point ask to Japanese SMEs: set up operations within India’s 11 dedicated Japanese industrial townships, send investment survey missions, visit tech hubs like Bengaluru and use bilateral channels for grievance redressal. Discussions with Aichi Prefecture Governor Hideaki Omura and Aichi Steel reaffirmed the continued relevance of traditional heavy industry alongside the newer technology push.
Osaka: Materials and Consumer Manufacturing
The final Osaka leg targeted specialised supply chain nodes, with meetings involving ROHM on semiconductor components, Daiki Aluminium on advanced aluminium supply chains and Nippon Paint on coatings. The inclusion of Mizuno Corporation signalled interest in elevating India’s sports and consumer goods manufacturing for export competitiveness.
The Trade Deficit Driving the Urgency
Behind the diplomacy lies a widening trade imbalance. Bilateral merchandise trade reached $27.47 billion in FY26, growing 9.18% year-on-year, but India’s imports from Japan, concentrated in precision machinery and specialised steel, stood at $21.43 billion against exports of just $6.04 billion, leaving a deficit of $15.40 billion that has widened from $12.66 billion the previous year. This imbalance, compounded by domestic steel producers’ concerns over Japanese hot-rolled steel imports, is a central reason New Delhi is pushing Japanese firms to manufacture in India rather than export to it.
The $150 Billion Semiconductor Pitch
India’s semiconductor pitch rests on a projected $150 billion domestic demand by 2032 and a six-pillar strategy spanning IP creation, machinery and materials, fabrication, packaging, R&D and talent development, an area where India claims to have already trained 68,000 students across 315 universities. The logic is straightforward: India offers downstream market scale and design talent, while Japan holds near-monopoly positions in fabrication equipment, photoresists and ultra-pure silicon wafers, capabilities India currently lacks.
Deep-Tech and the Innovation Bridge
Beyond semiconductors, Goyal proposed a “Japan-India Deep-Tech Capital Corridor” and highlighted India’s proposed $1 billion Fund of Funds for deep-tech enterprises. The India-Japan Pitching Series has already connected 65 Indian startups with around 100 Japanese corporations, yielding more than 30 business tie-ups in areas including AI, space technology and robotics, evidence that smaller-scale collaboration is progressing even as headline mega-deals remain elusive.
What Still Needs to Happen
Several execution risks remain unresolved. The two-month timeline for BIS gazette notifications is tight and will likely face domestic protectionist pushback. Japanese financial institutions flagged persistent concerns about profit repatriation ease, capital market access and regulatory predictability, all prerequisites for reaching the long-standing 10 trillion yen investment target. Perhaps most critically, while Delhi can negotiate trade frameworks and approve incentive packages, the actual delivery of manufacturing infrastructure, land, water, power and logistics, depends on state and municipal governments, a historical friction point the visit’s assurances did not resolve.
Looking Ahead
The tour’s real test lies beyond the four days themselves. Whether the BIS exemption framework materialises on schedule, whether Semicon 2.0 funds translate into actual fab groundbreakings, and whether state governments can deliver the physical infrastructure Japanese investors require will determine if this diplomatic full-court press converts into the semiconductor partnership both governments have outlined on paper.
About the Author
