India & Japan have complementarity of Interest: Arvind Panagariya
While Japan has the financial capital, India is well endowed with labour, making the two countries candidates for a complementary partnership. This was stated by Dr. Arvind Panagariya, Vice Chairman, Niti Aayog. Dr. Panagariya was addressing the Country Session on Japan “Indigenous Contribution to Manufacturing” organized by the Confederation of Indian Industry (CII) and the Japan External Trade Organisation (JETRO) at the Make in India Week in Mumbai today. CII is the partner of the Department of Industrial Policy and Promotion (DIPP) and the Government of Maharashtra in organizing the mega event being held from 13th -18th February 2016 in Mumbai.
According to Dr. Panagariya, there was a long history of cooperation between India and Japan. Referring specifically to Maruti Suzuki, he pointed out that Japanese companies ventured into India even when the Indian market was not open. He pointed out that Maruti Suzuki helped bring about a sea change in the automobile market in India.
Dr. Panagariya stated that the level of trust between India and Japan was very high and it is for this reason that Japan is the only developed country with which India has a FTA. He was of the view that India’s large market and its large labour force make it an attractive destination for Japanese companies to invest in India.
In his address, Mr. Amitabh Kant, Secretary, Department of Industrial Policy and Promotion, Ministry of Commerce and Industry stated that Indians have always admired the Japanese growth model that it adopted post World War II. Japanese companies such as Sony and Sanyo were household names in India. However, in his view, Japanese companies in the recent past had stopped using India as a manufacturing hub and thereby ceded valuable market share to companies from other countries. This trend, in his view needed to be reversed and he invited Japanese companies to set up a manufacturing base in India and cater to not only the Indian market but also to global markets. He cited the example of Suzuki – one of the pioneers of Japanese manufacturing in India – which has successfully become a global manufacturing hub for several models produced by the company.
According to Mr. Hiroto Izumi, Special Advisor to the Prime Minister of Japan, the world was looking at India to act as a global manufacturing base for many companies. He stated that companies should not only make in India and sell in India but also export to the world. He stated that in order to help India become a manufacturing hub, there was a need to upgrade the skills of Indian workers and Japanese companies were working closely with ITIs for this purpose.
In his address, Mr. Seiji Takagi, Diector General for Southwest Asia, Trade Policy Bureau, Ministry of Economy, Trade and Industry (METI), Government of Japan following the recent visit of Prime Minister Abe to India, Japan Bank for International Cooperation (JBIC) had instituted the Japan – India Make in India Special Finance Facility which would provide loans to Japanese companies to support direct investment in India. He also stated that JBIC was working to create Special Industrial Townships in India in various parts of the country. According to Mr. Takagi, the Internet of Things was a new area which the Japan External Trade Organisation (JETRO) was looking to promote and create partnerships between Indian and Japanese companies.
In his address, Mr. Sanjay Kirloskar, Chairman, CII Western Region and Chairman and Managing Director, Kirloskar Brothers Ltd. stated that while India has made tremendous strides in highly specialized fields like space science, nuclear energy, biotechnology, medicines, engineering among others, it could still stand to benefit by cooperating with Japan especially in terms of cutting edge technologies.