JETRO to Japanese Cos: Look for investing in less-industrialized north Indian states as an option

NEW DELHI: Japan’s apex industrial body Japan External Trade Organization (JETRO) has advised the Japanese companies planning to invest in India to explore the possibilities of setting up their basis in less-industrialized northern states as an option because of incentives, and other attractions like availability of labour at a reasonable cost.

“Though industrial development in many states is not advanced there are advantages in terms of labour availability, cost; and incentives can be enjoyed in these less-industrialized states. These states have the potential for certain industries and businesses, hope you would rediscover new possibilities in these north Indian states,” said Yasuyuki Murahashi, Chief Director General, JETRO India while addressing potential Japanese investors during an Indo-Japan Webinar recently.

He was probably hinting at less-industrialized states like Uttarakhand and Himachal Pradesh.

“Uttarakhand and Himachal Pradesh are famous for agriculture and tourism, and industrial development here is still in its infancy stage. Pesticide-free and organic vegetables from both states are supplied to Delhi. When the number of Japanese companies in Uttrakhand was in single digit, Denso and Panasonic acquired many Indian companies there and set up manufacturing basis in this state,” said JETRO India chief.

The webinar titled “Investment Opportunities in the Northern States of India” was jointly organized by the Embassy of India in Tokyo, JETRO, Japan-India Business Cooperation Committee (JIBCC), Invest India and governments six north Indian states – Uttar Pradesh, Bihar, Uttarakhand, Haryana, Himachal Pradesh, and Punjab.

“Uttar Pradesh and Bihar are large in population size and agriculture is the main sector here. However, the per capita GDP of these states is under $1000. These states hold key to India’s future development. UP is the state where industrial parks and startup are clustered in NOIDA and it is the part of Delhi economic zone.”

While pointing at the deficient infrastructure and other concerns in the already-industrialized states, the JETRO India chief said that many Japanese companies have set up their basis in Haryana and in national capital territory areas but there are many disputes between local parties and Japanese companies in this area.

“There are some ongoing mega infrastructure projects in Delhi including Delhi Mumbai Industrial Corridor (DMIC) but there is still great room for growth in infrastructure development,” said Yasuyuki Murahashi.

In deep contrast, he was all praise for Punjab and personally recommended the Japanese companies to try and set up a manufacturing basis there.

“Punjab known predominantly for the Sikh population is blessed with fertile land and water. Sectors like agriculture and food processing are flourishing here. The state is known for almost no labor conflicts which are quite rare in India. The infrastructure in the state including electricity is well developed. I have attended an investment seminar in the state and from my experience, I can tell you that it is comfortable to work with Punjab,” Yasuyuki Murahashi.

The opening remarks were made by Mona Khandar, Minister (Economic & Commerce), Embassy of India in Tokyo highlighting the series of reforms announced in Atma Nirbhar Bharat stimulus package by the Government of India post COVID-19 as well as the opportunities for Japanese investors. She also highlighted the taxation reforms undertaken by the government to promote Make in India initiative and India’s infra pipeline policy for the next 5 years which will cover more than 6,500 projects.

Yasuyuki Murahashi, Chief Director General, JETRO India made a presentation on the investment environment in the Northern States and Representatives from the States of Uttar Pradesh, Bihar, Uttarakhand, Haryana, Himachal Pradesh, and Punjab gave presentations highlighting the incentive schemes and series of reforms for ease of doing business as well as the investment opportunities for Japanese investors on their respective states.

During the webinar, Yogesh Arora, Plant Head of Denso India also shared companies Make in India experience in the Uttarakhand and Yugo Hashimoto, Managing Director and CEO, SML Isuzu Limited made a presentation on the advantages of the manufacturing industry in Punjab.

Kazunori Ajiki, Managing Director, Yanmar India Pvt. Ltd. also made a presentation on their operation in India. Yanmar considers India as the global supply hub for tractors because of its strategic location, cost competitiveness, and stable workforce.

Harshita Madan, Investment Specialist, Invest India made a presentation about Invest India and how they could assist Japanese companies, which are planning to make an investment in India.

At the end of the webinar, a Networking and B2B session was held during which Japanese companies and Indian companies introduced themselves briefly and they were given the option to interact among themselves through the chatbox.