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India-Japan bilateral trade has the potential to rise to USD 50 billion by 2030 from USD 27.47 billion in 2025-26, with greater export diversification, an upgraded trade pact and deeper business engagement key to achieving the target, industry body ASSOCHAM said in a report.
The report said India's share in Japan's total global imports remains below 1 per cent, leaving significant room to expand Indian exports in areas such as pharmaceuticals, chemicals, machinery, electronics and marine products. "ASSOCHAM believes that India Japan bilateral trade has the potential to reach USD 50 billion by 2030, supported by growing economic complementarities and deeper business engagement," ASSOCHAM Chief Economist S P Sharma said in the report. Bilateral merchandise trade has risen from USD 15.36 billion in 2020-21 to USD 27.47 billion in 2025-26, an increase of nearly 79 per cent in five years. However, the trade balance has remained in Japan's favour, with India's imports from Japan at USD 21.43 billion against exports of USD 6.04 billion in 2025-26. ASSOCHAM said India could increase its presence in Japan's large import market by moving towards higher-value products. Its report identified pharmaceuticals, chemicals, machinery and mechanical products, electronics and marine products among the segments with the greatest export potential. India's share of Japan's global imports was 0.93 per cent in 2025, while its share was considerably higher in organic chemicals at 6.33 per cent and automobiles and auto components at 4.4 per cent, indicating areas where Indian businesses have already established a stronger presence. The report also called for an upgrade of the 15-year-old India-Japan Comprehensive Economic Partnership Agreement, including steps to address non-tariff barriers and provide greater support for Indian MSMEs seeking access to Japan. "Rather than relying on traditional goods trade, both sides should push India's exports up the value chain," ASSOCHAM said, highlighting pharmaceuticals, IT services and renewable energy technology as areas with scope for expansion. Japanese investment could provide another boost. Japan has committed to invest JPY 10 trillion (around Rs 5.5 lakh crore) in India over the next decade, while more than JPY 2 trillion (around Rs 1.1 lakh crore) has already been committed through 129 private-sector agreements, the report said. The report said the next phase should also focus on easing regulatory procedures, strengthening two-way technology transfer and bringing more Indian MSMEs into Japanese and global supply chains. (ANI)
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