India and Japan, had signed a five-point action agenda to increase bilateral trade and investments on Thursday30th April 2015. This agenda is in line with Prime Minister, Mr Narendra Modi’s initiative of ‘Make In India’. The five-point agenda includes development of townships in India as Japanese industrial townships.Others included in the five-point agenda are promotion of investment and infrastructure development, further development and co-operation in IT sector, enhancing co-operation in strategic sectors and Asia-Pacific economic integration.
- As per Japan Minister of Economy, Trade and Industry Mr Yoichi Miyazawa, this agenda is in line with Indian Prime Minister’s initiative and would help both the countries in to strengthen economic ties.
- These agenda’s are absolutely mandatory in furthering trade relations between the two countries.
- Indian Commerce and Industry Minister Mrs Nirmala Sitharaman and Japanese Minister Miyazawa signed action agenda.
- The agreements in these action agenda’s would be historic milestone in economic relations between India and Japan.
- The Japanese Minister was accompanied with a business delegation in New Delhi.
- In September 2014, prime ministers of both the countries aimed in doubling Japans direct foreign investment in five years time.
- In 2013-14, the bilateral trade was $16.29 million dollars and between April 2000 to February 2015, India received $18 billion as foreign investment.
- Japan is fourth largest foreign direct investment[ FDI] contributor to India.
Japan’s major FDI interests includes pharmaceutical,automobile sector, service sectors that accounts for 7.46% of total FDI equity flows into India.
ABOUT FOREIGN DIRECT INVESTMENT OR FDI
- FDI is controlling ownership in business enterprise in one country by an entity present in other country.
- It includes mergers and acquisitions,building new facilities, reinvesting profits got from overseas operations etc.
- Different forms of FDI are low corporate taxes, tax holidays, special economic zones, bonded warehouses etc.
- Foreign investment in India under FEMA[FOREIGN EXCHANGE MANAGEMENT ACT] was introduced by Finance Minister Mr Manmohan Singh in the year 1991.
- Some foreign investments in India are TMI Mauritius ltd, Cairn UK Holding,ORACLE Global[Mauritius] Ltd etc.