Japan and India Build a 10-Year Pact to Cut Dependence on China

According to official statements from both governments, Japan and India will finalize a ten-year cooperation plan during a summit in Tokyo this month.

The plan will establish joint projects in semiconductors, critical minerals, clean energy, telecoms, pharmaceuticals, and advanced technologies, including artificial intelligence.

Both governments confirm that the agreement will use public funding and private investment to strengthen supply chains from research to production.

The main purpose is to reduce reliance on China for vital materials and components. India still imports large shares of pharmaceutical ingredients and fertilizers from China, while Japan depends on Chinese supplies of semiconductors and rare earth minerals.

Recent export restrictions on gallium and germanium highlighted the risks of such dependence. Officials in both countries frame this pact as an economic security measure to protect industries in case of disruption.

Both governments already signaled the shift. In July, Japan’s Ministry of Economy, Trade and Industry, its embassy in India, and JETRO hosted a major conference in New Delhi.

The event connected Japanese and Indian firms in battery materials, refining, and recycling. Organizers confirmed the aim was to create supply chains that do not rely on any single country.

Strengthening India-Japan Ties

India has also taken steps to manage its mineral resources more strategically. In June, the state-owned company IREL suspended rare earth exports to Japan to preserve domestic stock and build local magnet production.

In August, IREL began talks with Japanese companies for technology transfer and investment in magnet manufacturing. These moves show the governments want to build industrial capacity inside India rather than remain raw material suppliers.

Investment figures also point to deepening ties. Japan’s direct investment in India reached 924 billion yen, or about 6.25 billion US dollars, in 2024.

That amount is more than three times higher than ten years earlier, according to Japan’s official statistics. Rail cooperation will also feature in the summit.

East Japan Railway confirmed development of the E10 Shinkansen, a new model designed for service in the 2030s. India plans to introduce the train on the Mumbai–Ahmedabad high-speed line, expanding an already established technology partnership between the two countries.

Officials say the framework will include monitoring mechanisms and forums with industry leaders to quickly identify problems and adjust policies.

By linking Japan’s capital and expertise with India’s scale and growing technology sector, the pact seeks to build resilient supply lines in Asia.