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Officials from India and Japan met in New Delhi to talk about how they might work together in important areas like semiconductors and building strong supply lines. The goal of the talks was to get Japan to spend $35.9 billion in India by 2027.
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During the meeting, S. Jaishankar and Yoshimasa Hayashi, the foreign ministers of both countries, talked about ways to improve cooperation in military equipment and technology. The talks happened during Hayashi’s two-day trip to the Indian city.
In a statement from the Ministry of External Affairs, Hayashi and Jaishankar also talked about how important a strong partnership between India and Japan is for making sure that the Indo-Pacific region is open, prosperous, and built on rules for everyone.
During their talks, they talked about ways to work together in multinational and plurilateral groups, such as the Quad, which includes the US and Australia. The main goal of this collaboration is to deal with the problems that are getting worse because of China’s acts.
PM Modi wants to start a chip-making industry in India. But when the technology company Foxconn pulled out of a joint venture with the Indian mining company Vedanta Ltd. that was worth $19.5 billion, this could be seen as a loss.
India and Japan signed a memorandum of understanding (MoU) on July 21 about developing semiconductors. This will include designing, making, researching equipment, and developing talent.
Ashwini Vaishnaw, a minister for the Union, said that the agreement was a big step towards making a strong full value chain.
“The MoU is about five things: designing semiconductors, making them, researching equipment, training people, and making the semiconductor supply chain more stable,” said Vaishnaw.
He also said that agreements like the US-India initiative on Critical and Emerging Technology (iCET) and the one that exists with Japan gave clear guidance to businesses from both countries when they talked with each other. He said that it is clear that the government’s plan now is to help India’s industries, whether they work with the US or Japan.
The Japan MoU comes after investments from Micron Technology, which recently said it would spend $2.75 billion to set up a semiconductor unit in India, and Applied Materials, which will spend $400 million to set up a joint R&D centre.
In February of the year before, the two companies told the public that they were working together to set up a joint business in India that would make chips and display panels.
India has put a lot of effort into building a strong chip-making industry as part of its plan to be self-sufficient and ensure stable supply lines. To help projects to make semiconductors and displays, the country has set up cash incentives worth up to 50% of the total cost of the project, or $10 billion.
India and Japan have a strong business relationship. In the fiscal year 2021-2022, they will trade $20.57 billion worth of goods and services with each other.
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