India ranks highest as 72.5 per cent Japanese Cos. to expand in India: JETRO Survey (Asia Pacific)

ACN EXCLUSIVE. NEW DELHI: India has topped the list of countries in the Asia-pacific region as the country’s maximum number of existing Japanese companies here plan to expand their running operations. In a survey conducted by Japan External Trade Organization (JETRO) recently, 72.5 percent of the Japanese that responded with their feedback, disclosed their plans to expand their operations and invest more in India in next one to two years.

JETRO Fiscal 2022 Survey of Japanese Companies Operating Overseas Results – Asia and Oceania” conducted on 19 countries such as China, Australia, New Zealand, Sri Lanka   including ASEAN.

Bangladesh closely followed India, and it’s 71.6 per cent of Japanese companies plan to expand. China was found to be among the least preferred nations in this survey as only 33.4 per cent of Japanese companies opted to expand here.

JETRO Survey covered 14,290 Japanese companies operating in 20 countries/regions includiung 5 countries/regions in Northeast Asia, 9 countries in Southeast Asia, 4 countries in Southwest Asia, and 2 countries in Oceania. Number of valid responses     were received from 4,392 companies.

As many as 44,5 per cent of these companies in Asia pacific region disclosed their intention to expand their existing operations. On the other hand, companies in China intention to “expand” was 33.4 per cent the lowest level since the 2007 survey. In addition, about 30% of companies in politically troubled Myanmar and Sri Lanka answered that they would “shrink.”

India has a total of 1439 Japanese companies operating. However, 269 of them responded to the survey, and 195 (72.5 per cent) of them said they would expand their operations. The annual survey also found that 24.5 percent of the Japanese companies preferred to maintain status quo, while 3 per cent said they may wind up their operations and move from India.

Going by the JETRO survey results, it is now expected that the total count of the Japanese companies will grow in next 1-2 years as expansion plan would require more Japanese SMEs to enter India to support the already existing companies.

Japan is the 5th largest investor in Indian economy with cumulative FDI inflows of US$ 38.13 bn from April 2000 to September 2022. Key sectors include automobiles, Electronics System Design & Manufacturing (ESDM), Medical Devices, Consumer goods, Textiles, Food processing and Chemicals.

Related article: Despite weak business sentiments, 51 % of existing Japanese companies to expand operations in India: JETRO