According to a government statement, Japan would offer financial help to two firms, Toyota-Tsusho as well as Sumida, for the establishment of a manufacturing economy in India. Toyota-Tsusho is indeed the Toyota group’s trading arm, and it really is considering investing in rare earths.
Sumida manufactures components for the automotive, consumer electronics, and industrial markets.
The funds will indeed be offered as part of a Japanese government incentive to firms who relocate industrial bases from China to Japan, India, or Bangladesh.
Prime Minister Narendra Modi met with top executives from major global sovereign wealth funds as well as pension funds on Thursday, including Japan Post Bank and the Japan Bank for International Cooperation. Over the following two weeks, he’ll likely meet with some of these investors one-on-one. Following the virtual meeting, financial help for these two firms was transmitted to the Indian government, according to the source. On September 14, the Economic Times claimed that New Delhi has approached a number of Japanese firms.
As part of it’s own recent attempt to grant subsidies to firms migrating from China, Japan has decided to provide financial aid to two companies — Toyota-Tsusho and Sumida — to diversify their production base to India.
According to reports, the decision was made during Prime Minister Narendra Modi’s Thursday conference with foreign investors.
Modi will hold one-on-one talks with investors, along with some major Japanese businesses, following the round table talks on Thursday.
Sumida is a supplier of automotive parts, whereas Toyota-Tsusho is planning to establish a rare earth metals factory. “Work had been going on to try to lure these firms to India,” a government source said, “but the Japanese side decided to give help to make the process more appealing for the two companies.”
India and Japan have been attempting to form a coalition to fight China’s expanding influence, and their connections have become stronger since the emergence of the Covid-19 epidemic.
India and Japan, together with Australia, had created an Indo-Pacific supply chain resilience effort, and the government had encouraged Tokyo to broaden the scope of its financial aid to India.
Japan has informally unveiled a $2 billion strategy aimed at restoring some of its businesses and expanding into new markets. Whereas the majority of the cash would go to companies who relocate from China to Japan, India and Bangladesh will also receive support.In comparison to 5,100 in India, there are an estimated 30,000 Japanese enterprises with manufacturing bases in China, which now has emerged as the world’s factory.
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