Modi Secures Investment Commitments from Japan Worth Up to $68 Billion

Indian Prime Minister Narendra Modi has secured a commitment for investment of up to ¥10 trillion ($68 billion) from Japanese Prime Minister Shigeru Ishiba on Friday, as both countries work to strengthen their partnership amid the trade challenges posed by increasing US tariffs.

“We both agreed that as leading economies and dynamic democracies, our cooperation is essential not only for our nations but also for global peace and stability,” Modi mentioned during a joint press conference following talks with Ishiba.

Japan aims to encourage private-sector investments in India, targeting ¥10 trillion over the next decade—a significant boost for an economy recently affected by a 50% tariff imposed by President Donald Trump, the highest in Asia.

This investment is part of a broader economic security collaboration that includes cooperation on semiconductors, critical minerals, and artificial intelligence. The two nations also unveiled new initiatives to support startups and collaborate on clean energy and space projects.

The commitment to strengthen ties comes as India reassesses its geopolitical strategy and seeks support from allied countries following a decline in relations with the US. As a part of this shift, Modi plans to visit China for the first time in seven years after his trip to Japan, and is expected to meet with leader Xi Jinping in an effort to mend relations following a 2020 border conflict that strained ties.

Japan, which has faced challenges in its automotive sector due to Trump’s tariffs, is also keen to enhance trade with like-minded nations as it looks to access India’s vast market and youthful population.

India and Japan have revised a 2008 joint statement on security collaboration to more effectively address current challenges, according to Ishiba.

“In this increasingly uncertain international landscape, Japan and India must work together to maintain peace and stability in the region,” Ishiba stated.

The updated defense agreement includes commitments for broader joint exercises, cooperation on critical minerals, and potential joint development and production of military equipment, as stated by the Japanese foreign ministry.

New Delhi is particularly interested in technology transfers and collaborating on military hardware development, according to sources familiar with the discussions. India and Japan are aiming to develop advanced sensors for seamless communication while enhancing the stealth capabilities of warships.

India ranks as the second-largest arms importer in the world, following Ukraine—according to the Stockholm International Peace Research Institute. The country seeks to increase its domestic arms manufacturing and acquire technology from nations like France, Germany, Japan, and the US.

The two governments are also committed to continuing collaborative efforts to introduce a high-speed bullet train to India, Ishiba noted, and the leaders have agreed to facilitate the exchange of 500,000 individuals across various industrial sectors over the next five years.

© 2025 Bloomberg

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