This article covers trade and investment between India and Japan: the value and composition of bilateral trade, the India-Japan Comprehensive Economic Partnership Agreement, Japanese investment and companies in India, the business forums and industrial mechanisms set up by the two governments, and their dialogue on economic security. The figures and facts are taken from the Ministry of External Affairs (MEA) bilateral brief of June 2026 and describe the position at that date.

Bilateral trade

According to the MEA brief of June 2026, India's total trade with Japan in FY25-26 was USD 27.48 billion, made up of exports of USD 6.04 billion and imports of USD 21.44 billion. In 2024-25, India ranked 18th in Japan's total trade with a 1.4% share, while Japan ranked 17th in India's total trade with a 2.1% share.

The brief gives earlier figures from India's Ministry of Commerce data bank, in US dollar billion:

  • 2020-21: exports to Japan 4.43, imports from Japan 10.9, bilateral trade 15.33
  • 2021-22: exports 6.18, imports 14.39, bilateral trade 20.57
  • 2022-23: exports 5.46, imports 16.49, bilateral trade 21.96
  • 2023-24: exports 5.15, imports 17.69, bilateral trade 22.85
  • 2024-25: exports 6.25, imports 18.92, bilateral trade 25.17

Main items traded

The brief lists India's primary exports to Japan as:

  • Organic Chemicals
  • Vehicles (Other than railways & trams)
  • Nuclear Reactor
  • Aluminium and Articles thereof
  • Fish & other aquatic invertebrates

India's primary imports from Japan are listed as Nuclear Reactors, Copper and Articles thereof, Electrical Machinery and Equipment, Inorganic Chemicals, and Iron and Steel.

Comprehensive Economic Partnership Agreement

The India-Japan Comprehensive Economic Partnership Agreement (CEPA) came into effect from 1 August 2011. It covers trade in goods as well as services, movement of natural persons, investments, intellectual property rights, custom procedures and other trade-related issues. The brief states that 94% of the items traded between India and Japan in 2011 saw tariff reductions by 2021.

To expand economic and business ties and address CEPA implementation issues, Sub-Committees have been established under the agreement in the following areas:

  • Rules of Origin
  • Customs Procedures
  • Technical Regulations, Standards and Conformity Assessment Procedures & SPS Measures
  • Trade in Services
  • Improvement of Business Environment
  • Movement of Natural Persons & Cooperation

India's Commerce Secretary visited Japan in March 2026 and held the 7th round of the Joint Committee Meeting on the CEPA.

Japanese investment in India

The brief gives Japanese outward FDI to India as US$ 1.49 bn in FY 2021-22, 1.79 bn in FY 22-23, 3.17 bn in FY 23-24, 2.48 bn in FY 2024-25 and 3.7 bn in FY 2025-26. Cumulative FDI equity inflow from Japan between April 2000 and March 2026 was around US$ 48.14 billion. This ranks Japan fifth among source countries for FDI into India and accounts for 6% of total FDI into India, according to the brief.

Japanese FDI into India has mainly been in the automobile, electrical equipment, telecommunications, chemical, financial (insurance) and pharmaceutical sectors.

Two investment targets have been set at Annual Summits. At the 14th Annual Summit in March 2022, a target of JPY 5 trillion of public and private investment and financing from Japan to India was set for the next five years. At the 15th Annual Summit in August 2025, the two sides set a target of 10 trillion yen (USD 67 billion) of Japanese private investment in India over the next decade.

Japanese companies in India and Indian companies in Japan

As of the brief, about 1500 Japanese companies are registered in India, with manufacturing firms accounting for half of them. These companies have nearly 5000 business establishments in India. More than 100 Indian companies are working in Japan.

India ranked 1st in a JETRO survey in 2025 on the countries in which Japanese companies wanted to expand their local operations over the next 1 to 2 years. Among Japanese companies based overseas, the brief says, India had one of the highest operating profit forecasts for 2025 in Asia, at 75.5%.

Industrial Competitiveness Partnership

A Memorandum of Cooperation on the India Japan Industrial Competitiveness Partnership (IJICP) was signed on November 16, 2021 between India's Department for Promotion of Industry and Internal Trade (DPIIT) and Japan's Ministry of Economy, Trade and Industry (METI), to jointly explore ways of enhancing India's industrial competitiveness. Joint Working Groups have been formed under it in sectors such as textiles, logistics, steel and food processing.

A roadmap under the IJICP was announced at the 14th Annual Summit. The 7th meeting of the partnership was held during the visit of Secretary (DPIIT) Shri Amardeep Singh Bhatia to Japan on 17 September 2025.

The 15th Annual Summit established an India-Kansai Business Forum and an India-Kyushu Business Forum, and the two sides agreed to launch an India-Japan SME Forum. On November 21, 2025, the Japan-India SME Forum was inaugurated in Tokyo. It was co-hosted by METI, the Embassy of India, Tokyo, the Japan Chamber of Commerce and Industry (JCCI) and the Japan External Trade Organization (JETRO).

The 1st SME Mission (Public Private delegation) from Japan visited Delhi and Bengaluru on 14-19 December 2025. It was led by Mr. Tatsuo Yasunaga, Chairman JIBCC & Mitsui Corporation, and a Vice Minister from METI, and focused on the aerospace sector.

The brief says the relationship has further deepened through frequent exchanges between Indian states and Japanese prefectures. Since April 2025, the Chief Ministers of Meghalaya, Nagaland, Telangana, Chhatisgarh, Haryana, Punjab, Arunachal Pradesh and Uttar Pradesh have visited Japan to engage with Japanese stakeholders and promote their states as investment destinations. From Japan, the Governors of Saga, Gunma and Wakayama prefectures have visited India.

Economic security

As an outcome of the 3rd 2+2 Ministerial Meeting in New Delhi in August 2024, the two sides launched a Dialogue on Economic Security including Strategic Trade and Technology, to deepen collaboration in supply chain resilience, strategic trade and technology. The inaugural round, chaired by India's Foreign Secretary and Japan's Vice Foreign Minister in November 2024, identified five priority sectors for strategic collaboration: telecommunications, clean energy, critical minerals, pharmaceuticals and semiconductors. The 2nd round was held in May 2026, during the Japanese Vice Minister for Foreign Affairs' visit to India.

The Economic Security Initiative launched at the 2025 Annual Summit aims to promote supply chain resilience in strategic sectors such as semiconductors, clean energy, telecom, pharmaceuticals, critical minerals and new and emerging technologies. The first Private Sector dialogue on Economic Security was held on March 26, 2026, and a business track of the Dialogue on Economic Security is being planned, with CII and the Japan External Trade Organisation (JETRO) to take the lead. India and Japan also cooperate on supply chain resilience through the Quad framework.

In 2025, a Memorandum of Cooperation in the Field of Mineral Resources was signed to advance supply chain resilience for critical minerals, including through the development of processing technologies, joint investments for exploration and mining, and efforts to stockpile critical minerals. The 1st Joint Working Group meeting on Critical Minerals under this Memorandum, between the Ministry of Mines of India and the Ministry of Economy, Trade and Industry of Japan, was held by video conference in April 2026.