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Japan Asks for Ease Hurdles in FDI
Aug 29, 2014

As the Indian government prepares for Prime Minister Narendra Modi’s visit to Japan, manufacturers and investors in Japan have flagged the current state of Indo-Japan infrastructure projects, as well as financial regulations that are hurting the prospects of more Foreign Direct Investment (FDI).

The president of the Japanese Chamber of Commerce and Industry in India has written to Commerce ministry, seeking urgent intervention to resolve the issues in areas including India’s tax system, banking sector, logistics and distribution segment, visas and the pivotal infrastructure sector.

More than 35 suggestions have been handed over to the government relating to the delays and roadblocks in Japanese investment in India. In particular, the demand relates to expediting infrastructure projects for which Japan has committed more than $100 billion, like the Delhi- Mumbai Industrial Corridor (DMIC) and the Chennai-Bangalore Industrial Corridor (CBIC), where feeder roads to be built by the Central and State governments, are delayed. The greatest roadblock Japanese face is the lack of coordination and cooperation between the Central government and the State governments for these projects.

One of the major concerns for India and Japan has been dipping bilateral trade. Trade declined sharply in 2013 to $16.31 billion, from $18.43 billion in 2012. Japanese FDI to India has dipped from a high of $2.09 billion in 2011-12 to $1.3 billion in 2012-13. 


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