India aims to attract 10 trillion yen in Japanese investment: Modi

Prime Minister Narendra Modi on Thursday said India aims to attract 10 trillion yen in Japanese investment over the next decade and double the number of Japanese companies operating in India, as the two countries unveiled a broad agenda to deepen their strategic and economic partnership.

The bilateral investment partnership continued to strengthen, said Modi, during the joint press statement after the India-Japan Annual Summit with Japanese Prime Minister Sanae Takaichi.

He said more than 100 new business agreements had been concluded over the past year and were expected to bring more than $10 billion in Japanese investment into India.

He added that an agreement between the two countries' financial services agencies would facilitate capital and investment flows, while India's ongoing reforms had improved the ease of doing business, creating greater opportunities for Japanese companies to expand their presence in the country.

Technology emerged as a key focus of the summit, with the two countries issuing a joint statement on artificial intelligence (AI). Leading institutions from both sides also signed agreements to strengthen cooperation in the sector.

Modi said Japan's precision technologies and India's software capabilities would together accelerate global AI development.

Cooperation in defence

In defence, India and Japan signed an agreement for their first co-development project involving a Naval Radio Antenna, marking a new phase in bilateral defence technology cooperation.

Modi said the two countries would jointly develop defence technologies to strengthen regional peace, maritime security and a rules-based order.

The two sides also adopted a Joint Roadmap on Economic Security to strengthen supply chain resilience in strategic sectors such as semiconductors, quantum technologies and advanced materials.

Investments in energy

In the energy sector, the leaders announced the India-Japan Bio-gas Initiative, under which Japan will support the establishment of 1,000 biogas and organic fertilizer plants in the country.

Modi said the initiative would strengthen the government's GOBARdhan (Galvanizing Organic Bio-Agro Resources Dhan) programme while promoting sustainability, rural prosperity and livelihoods.

The two countries also agreed to expand cooperation in batteries, green hydrogen and nuclear energy to support the clean energy transition.

The summit also saw the launch of the India-Japan Next Generation Mobility Partnership Framework, which seeks to expand bilateral cooperation beyond the automotive sector into shipbuilding, aviation and logistics.

Modi said India and Japan would further strengthen cooperation in talent mobility, skilling, technical internship programmes, research, education and startups. The two countries are also set to commemorate the 75th anniversary of diplomatic relations next year through enhanced collaboration in culture, tourism and the creative economy.

“Our economies are complementary, our values are aligned, and above all, our relationship is founded on unwavering mutual trust,” Modi said, expressing confidence that the partnership would contribute to the vision of a developed India, a stronger Japan and global prosperity.

India-Japan trade

Bilateral trade between the two countries reached $27.5 billion in FY26, while Japanese investment in India stood at $3.2 billion between April and December 2025, according to Indian government data.

Japan is among India's largest investors, backing major infrastructure projects, including a high-speed rail corridor between Mumbai and Ahmedabad. Japanese firms have also increased investments in ⁠Indian companies, including a recent $1.6 billion deal for a 20% stake in Yes Bank.

“This is historic given the change in nature office financial commitments by Japan, shifting from a risk-averse loan and liberal infrastructure finaning to direct investments in defense, critical minerals, semiconductors, automobiles to electronics. Japan and India share common challenges in Indo-Pacific and it is great to note that both countries are collaborating across the sectors for common regional challenges, mutual benefits and inclusive economic development. The deal on Yen-Rupee settlement is the icing on cake in this cherished geo-economic partnership,” said Ram Singh, professor and head, Indian Institute of Foreign Trade, New Delhi.

In a separate statement, the Prime Minister's Office (PMO) said the two sides agreed to further strengthen high-technology trade while addressing export control challenges through consultations among the relevant ministries.

The PMO said the leaders welcomed progress under the Economic Security Initiative, launched at the previous Annual Summit, including the inaugural Private-Sector Economic Security Dialogue and the second round of the Economic Security Dialogue held earlier this year. They also adopted the India-Japan Joint Declaration on Economic Security Cooperation to promote project-based collaboration in semiconductors, critical minerals, information and communication technology, clean energy and pharmaceuticals.

The statement added that the two prime ministers welcomed the launch of the India-Japan SME Forum and the visit of a Japanese SME mission from the aeronautical sector to India.

“They welcomed the steady progress of various efforts to improve business environment and to enhance the network for both Japanese and Indian businesses especially SMEs and startups. Building on the Japan-India Startup Support Initiative (JISSI), they expressed willingness to further encourage participation of Japanese SMEs and startups in the Indian market in collaboration with various universities. They also underscored the importance of greater participation of Micro, Small and Medium Enterprises (MSMEs) and linkages between Japanese enterprises and India's Tier-II and Tier-III supplier ecosystem. In this context, they reiterated their commitment to facilitate greater investment flows, industrial collaborations and technology partnerships,” the PMO said.