Japan Sets $68 Billion Investment Plan in India for Tech and Chips

Japan is set to invest ¥10 trillion (around $68 billion) in India over the next decade, with the goal of deepening bilateral relations and boosting collaboration in advanced technology sectors. The initiative will be formally presented by Japanese Prime Minister Shigeru Ishiba during his meeting with Prime Minister Narendra Modi at the 15th India–Japan Annual Summit, taking place on August 29–30. The announcement signals a major step forward in strengthening the strategic and economic partnership between the two countries.

The fresh plan comes alongside the revision of the India–Japan joint declaration on security cooperation, the first such update in 17 years. The investment will target eight priority areas including artificial intelligence (AI), semiconductors, mobility, environment, and medicine. Japan’s approach is not only to inject capital but also to foster deeper partnerships with Indian businesses and talent.

A central highlight of the plan is the AI Cooperation Initiative, which will create exchange programs for young researchers and expand AI research between the two countries. With India’s growing pool of engineers and specialists, Japanese companies see vast potential in hiring Indian talent to meet future workforce needs. Already, Japan faces a projected shortage of 790,000 workers in advanced technologies by 2030, while India produces over 1.5 million engineering graduates annually.

The semiconductor sector will receive particular attention, with PM Modi and PM Ishiba set to visit Tokyo Electron’s facility in Miyagi prefecture, a leading chipmaking equipment manufacturer. The visit will showcase Japan’s technological strengths while opening new opportunities for collaboration with Indian industries.

Japan is also channeling support through its official development assistance (ODA) to back startups entering the Indian market. The Japan International Cooperation Agency (JICA) has already extended loans to startups in Telangana, home to India’s IT hub, Hyderabad. Companies like Sompo Care and Sekisho are actively hiring and training Indian workers, providing Japanese-language education and placement support to bridge the talent gap.

This landmark investment reaffirms Japan’s commitment to India as a strategic partner. By combining Japan’s technological expertise with India’s talent base, the partnership is set to drive growth in AI, chips, and emerging technologies, shaping the future of innovation in both nations.

Source: Business Standard