- Japanese Prime Minister Shinzo Abe and his Indian counterpart Manmohan Singh pledged to deepen ties in trade and investment and boost efforts to strengthen the region's defense and energy security.
The leaders confirmed a shared commitment to more than triple bilateral trade to $20 billion by 2010 in a joint communiqué released after talks in New Delhi today. Abe had called for the rapid completion of a free-trade agreement in his speech to the Indian parliament.
A trade agreement would give Japanese companies including Hitachi Ltd. and Bridgestone Corp. greater access to the world's second-fastest growing major economy, helping them weather slowing export growth to China, the U.S. and Europe.
India's trade with Japan lags behind the South Asian nation's commerce with the U.S., the biggest partner, China and eight other nations. India's trade with Japan was worth $6.5 billion in 2006, compared with $26.8 billion of commerce with the U.S. and $17.6 billion with China. Japan's trade with India is less than 4 percent of its commerce with China.
The Delhi talks come after the two nations signed the so- called Japan-India strategic global partnership agreement in December. Under the accord, Japan and India will cooperate in the development of one or two seaports on the west coast, apart from industrial complexes.
Nuclear Energy
Singh said he expects Japan will help its bid to win international approval for a nuclear accord with the U.S.
India needs Japan's support in talks with the Nuclear Suppliers' Group to allow the South Asian nation to acquire reactors and fuel from overseas. Abe didn't make any promises on whether his country would back India.
``We will watch very closely, the implications this matter will have on the non-proliferation regime and nuclear disarmament,'' Abe said. ``It is essential for India to address appropriately negotiations with the IAEA in order to respond to the concerns of Japan and the international community.''
Singh said he's confident of overcoming communist opposition to the U.S. accord before completing negotiations with Japan and other suppliers.
``There is some turbulence here in Delhi,'' Singh said. ``I am confident we shall be able to overcome it.''
`Vital for Power'
Hitachi, Japan's third-largest builder of nuclear reactors, today said it plans to build nuclear power plants when bans on supplying India with atomic reactors are lifted.
``Nuclear energy is vital for power supply in India,'' Kazuo Furukawa, president of the Tokyo-based company told reporters in New Delhi today.
Singh backed efforts by Japan and four other nations to convince North Korea to dismantle its own nuclear facilities in return for alternative energy supplies, according to the communiqué. Singh also pledged to help Japan discover the fate of Japanese nationals abducted by North Korea.
In defense, Japan's security forces will conduct exercises with Indian naval vessels in the Bay of Bengal off India's east coast next month. They agreed on the need for greater security of sea routes as they enhance cross-border trade.
Infrastructure, Growth
Japan and India will set up a research fund for a project to connect New Delhi, India's capital, and Mumbai, its key port and financial center, according to the communiqué, echoing Abe's speech earlier today when he pledged Japanese financial aid for infrastructure development.
India's failure to match road, railways, and port development with its economic growth would be a blow to Japanese companies, including Nippon Steel Corp. and Suzuki Motor Corp., which are expanding manufacturing in the world's second-most populous country.
India is planning to build ports, airports, roads and set up industrial centers along the freight railroad connecting New Delhi and Mumbai, 1,483 kilometers (921 miles) apart. The first phase of the project is due for completion in 2012.
Japan will also consider funding a freight corridor linking the eastern city of Kolkata with New Delhi and Mumbai, the prime minister said in his speech.
The two leaders also pledged to join talks to create a United Nations framework to combat global warming after the Kyoto Protocol expires in 2012, according to the communiqué. Concerted efforts are vital for a new environment treaty in which all major countries emitting greenhouse gases take part.
Global Warming
The Abe government is accelerating efforts to take the lead in the global warming debate together with the U.S., China and India, the world's major emitters of the gases. Under the `Cool Earth 50' initiative, Abe proposes to cut the global emission of greenhouse gases by 50 percent from the current level by 2050.
Abe is in New Delhi with 243 executives, the largest such delegation, from companies such as Toyota Motor Corp. and Canon Inc., more than the 175 he took with him to the Middle East earlier this year. Japan has 4,757 companies in China and only 216 in India, according to Nomura Securities Co.
Japan's trade surplus narrowed more than economists forecast in July as automobile exports cooled, the Finance Ministry said in Tokyo today. Export growth to the U.S. slowed to a fifth of the pace of the previous month while shipments to Europe and China gained at the weakest pace in three months.
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