NEW DELHI – The number of Japanese companies registered in India increased 5.2 percent in 2018 from the previous year as the nation’s businesses continue to tap opportunities in Asia’s third largest economy.
The figure totaled 1,441 as of October, 72 more than a year earlier, with manufacturing firms accounting for half the total, according to the latest joint survey by the Embassy of Japan in India and the Japan External Trade Organization known as JETRO.
The number of Japanese business establishments starting up in India grew 5.5 percent this year to 5,102 from 2017, the survey released last week also showed.
They include liaison and branch offices in India as well as local subsidiaries.
“There was a significant increase in the number of companies in such sectors as metal manufacturing as well as services this year,” the survey said. It also found that some companies in India became non-Japanese due to corporate restructuring and change of ownership, among other reasons.
By region, the western state of Maharashtra and the southern state of Tamil Nadu have emerged as the top destinations for both Japanese companies and establishments, numbering 810 and 620, respectively, according to the report.
The survey showed, however, that despite a target agreed to four years ago between India and Japan to double both Japan’s foreign direct investment and the number of Japanese companies in the South Asian country by 2019, there are only about 25 percent more firms now than there were in 2014.
Although the Japan Chamber of Commerce and Industry in India, or JCCII, has engaged in promoting economic cooperation between the two countries, several issues remain to be addressed to improve both investment and business environments in India.
“While we recognize great efforts to implement the GST (Goods and Services Tax), our concerns on the tax system, banking sector, logistics and distribution, agriculture, intellectual property rights, procedures and infrastructure remain,” the JCCII wrote in a Sept. 13 letter to the Indian government.