India-Japan Trade: Focus on Semiconductors & Investment

India’s Commerce and Industry Minister Piyush Goyal is leading a 200-member business delegation to Japan for a four-day visit starting August 24, 2026, aiming to strengthen trade and investment ties. This initiative builds on Japan’s earlier commitment to invest 10 trillion yen, approximately Rs 60,000 crore, in India over a decade.

The diverse delegation includes representatives from manufacturing, semiconductors, clean energy, steel, automotive, financial services, healthcare, and start-ups. Minister Goyal’s itinerary encompasses Tokyo, Nagoya, and Osaka, reflecting a broad engagement strategy.

Strategic Engagements Across Japanese Cities

In Tokyo, Minister Goyal is scheduled to meet with leaders of major Japanese conglomerates and industrial houses. He will also participate in a roundtable discussion with Keidanren, the Japan Business Federation, to foster deeper industry connections.

Dedicated sessions in Tokyo will cover critical areas such as semiconductors, artificial intelligence, and start-ups, alongside engagements with foreign institutional investors. Bilateral talks are also planned with Akazawa Ryosei, Japan’s Minister of Economy, Trade and Industry, and other senior Japanese government officials.

The visit continues in Nagoya with a roadshow organized in collaboration with Chukeiren (Central Japan Economic Federation) and the Nagoya Chamber of Commerce and Industry. This segment will specifically target manufacturing investors within the automotive and steel sectors.

Concluding in Osaka, the delegation will host an investors and business roadshow. This event aims to highlight investment opportunities in India’s manufacturing, clean energy, and consumer markets.

The Commerce Ministry anticipates this visit will invigorate bilateral trade and investment, fostering new collaborations in high-technology manufacturing and next-generation industries. Discussions with the Japan External Trade Organization (JETRO) will explore opportunities for Japanese companies in India and strategies to boost two-way investment.

These discussions will focus on key areas including digital innovation, industrial transformation, advanced manufacturing, artificial intelligence, semiconductors, electronics, capital goods, and machinery.

Key Investment and Trade Figures

Japan stands as the fifth largest investor in India.

Foreign Direct Investments (FDI) from Japan between April 2000 and March 2026 totaled $48.14 billion, accounting for 6% of India’s total FDI during this period.

Bilateral trade between the two countries grew by 9.18% to $27.47 billion in 2025-26, up from $25.16 billion recorded in 2024-25.

Despite this growth, India’s trade deficit with Japan increased to $15.4 billion in the last fiscal year, indicating an imbalance in trade flows.

Reviewing the Comprehensive Economic Partnership Agreement

Both nations are considering a review of the Comprehensive Economic Partnership Agreement (CEPA), which came into effect on August 1, 2011. India has emphasized the critical need for a more balanced trade relationship, citing the growing trade deficit as a primary concern.

Domestic steel producers have also raised concerns regarding increased imports of steel products from Japan. This ongoing dialogue underscores the importance of re-evaluating the trade agreement to ensure equitable benefits for both economies.