A bullet train to shared futures

India expects Japan's promise of $67 billion investment to drive SMEs, startups, green energy, and exports, reinforcing Modi's agenda of competitive federalism.

- Archis Mohan

New Delhi is expecting that the 10 trillion yen ($67 billion) Japan has pledged in private investments over the next decade will slot directly into the government's effort to supercharge small and medium enterprises (SMEs) and startups, seen as the core engines of job creation.

The hope in India is that these investments will give muscle to Prime Minister Narendra Modi's vision of competitive federalism, with Indian states reaching out to Japanese prefectures to "make in India, make for the world" — and, crucially, to "make in India with Japan, export to the world," especially to Africa, West Asia, and Southeast Asia.

In the past two years alone, India and Japan have signed 170 Memoranda of Understanding (MoUs) worth $13 billion in committed investments.

Officials believe the latest announcement could double the number of Japanese companies registered in India from the present 1,400, half of them in manufacturing.

According to government sources, Japanese partnerships are steadily pulling Indian SMEs into global supply chains. Tokyo Electron's investments, Fujifilm's tie-up with Tata Electronics to create a semiconductor ecosystem, Toyota and Suzuki integrating hundreds of tier-two and tier-three SMEs into their value chains, and Fujitsu hiring 9,000 Indian engineers at its global capability centre are all part of the picture.

The government's assessment is upbeat: Indian SMEs will gain global-standard practices, advanced technology, and wider market access, lifting export competitiveness.