Welcome to our blog post on the incredible India-Japan trade phenomenon! From ancient cultural connections to booming economic ties, these two powerhouse nations have long maintained a mutually beneficial relationship. Today, we take you on a deep dive into the top 10 product Exports from India to japan that have contributed significantly to this ever-growing partnership.
Get ready to unveil the secrets behind the success of industries like pharmaceuticals, textiles, automotive parts, and more as they fuel trade between India and Japan. So grab your passport and embark on this fascinating journey through the heart of bilateral commerce!
Introduction to India-Japan Trade Relationship
The India-Japan trade relationship is one of the most important relationships in the world. Every year, India exports over $1 billion worth of goods to Japan, making it one of India’s top trading partners.
India’s exports to Japan consist mainly of textiles, chemicals, jewelry, and engineering products. In recent years, however, India has been exporting more and more services to Japan, such as IT services and tourism.
Japan is an important market for Indian exporters because it is a developed country with a high standard of living. Japanese consumers are willing to pay more for quality products, which makes it an attractive market for Indian businesses.
The Indian government has been working hard to improve the trade relationship between the two countries. In 2016, Prime Minister Narendra Modi visited Japan and signed several agreements that are designed to increase trade and investment between the two countries.
Overview of Product Exports from India to Japan
India and Japan have been engaged in trade for centuries. In recent years, trade between the two countries has grown substantially. In 2016-17, bilateral trade between India and Japan stood at $13.61 billion. India’s exports to Japan amounted to $6.36 billion, while imports from Japan were $7.25 billion.
The top product exports from India to Japan include textiles and clothing, organic chemicals, inorganic chemicals, iron and steel products, machinery, vehicles, leather products, and footwear. These products account for a large share of India’s total exports to Japan.
Textiles and clothing are the largest category of Indian exports to Japan. In 2016-17, textile and clothing exports from India to Japan totaled $1.63 billion. India is a major supplier of textiles and clothing to the Japanese market.
Organic chemicals are the second largest category of Indian exports to Japan, totaling $1.11 billion in 2016-17. Inorganic chemicals, iron and steel products, machinery, vehicles, leather products, and footwear are also important categories of Indian exports to Japan.
Top 10 Product Exports from India to Japan
The India-Japan trade relationship is one of the most important economic partnerships in the world. In 2020, bilateral trade between the two countries totaled $62.2 billion. India is Japan’s 10th-largest trading partner, and Japan is India’s second-largest trading partner after the United States.
There are many reasons for the strong trade relationship between India and Japan. The two countries have complementary economies, with India providing raw materials and Japan providing manufacturing expertise. They also share a common language and culture, which makes communication and collaboration easier.
In addition, the two countries have a history of close economic cooperation. Since 1964, they have been working together under the “Dhana-Mitsui Plan” to promote mutual economic development. This partnership has been especially beneficial for India, as it has allowed the country to access Japanese technology and capital.
The following are the top 10 product exports from India to Japan in 2023:
1. Petroleum products: $8.3 billion
2. Organic chemicals: $4 billion
3. Plastics: $2.7 billion
4. Iron and steel: $2 billion
5. Aluminum: $1.6 billion
6. Mineral fuels: $1.5 billion
7. Copper: $ 1 billion
8= Ethylene polymers: $900 million
8= Organic fertilizers: $900 million
10= Vehicles other than railway or tramway rolling stock, and parts and accessories thereof: $800 million
Analysis of Export Trends for Each Product
Between 2001 and 2011, India’s exports to Japan grew at a compound annual growth rate (CAGR) of 15.3 percent, while imports from Japan grew at a CAGR of 7.4 percent. In 2001, bilateral trade between the two countries totaled $5.4 billion, and by 2011 it had reached $36.8 billion.
There are many reasons for this impressive growth, but two factors stand out: first, the development of economic ties between India and Japan following the 1997 Asian financial crisis; and second, the expansion of Japanese companies in India following the country’s economic liberalization in 1991.
The Asian financial crisis led to a significant decrease in demand for Japanese products in Southeast Asia. In response, Japanese companies began to shift their production to lower-cost countries like China and India.
At the same time, the Indian government undertook economic reforms that made the country more attractive to foreign investors. As a result, Japanese investment in India increased significantly, from $2 billion in 2000 to $17 billion in 2010 (according to data from the Japan External Trade Organization).
This increase in investment has been accompanied by an increase in trade between the two countries. In 2001, bilateral trade between India and Japan totaled $5.4 billion; by 2011 it had reached $36.8 billion. The top product exports from India to Japan include textiles and garments, organic chemicals, iron and steel products, machinery parts, and vehicles.
Role of Free Trade Agreements in Trade Expansion
In recent years, free trade agreements (FTAs) have become an important tool for expanding trade between countries. FTAs provide a framework for reducing tariffs and other trade barriers and thus can help to increase the volume of trade between two countries.
The India-Japan FTA is a good example of how an FTA can lead to increased trade between two countries. The FTA came into force in 2011, and since then bilateral trade between India and Japan has grown rapidly.
In 2016, bilateral trade reached $13.8 billion, up from just $6.4 billion in 2010 (the year before the FTA came into effect). This increase in trade can be attributed in part to the preferential tariff treatment that goods from both countries enjoy under the FTA.
In addition to expanded bilateral trade, FTAs can also contribute to the growth of global value chains. For example, components that are used in the production of final goods may be sourced from multiple countries through different stages of production. By reducing barriers to trade at each stage, FTAs can make it easier for firms to source inputs from around the world and participate in global value chains.
The India-Japan FTA has been successful in fostering greater cooperation between the two countries on economic issues more broadly. The two countries have worked together on initiatives such as setting up joint business councils and establishing special economic zones. These initiatives have helped to create an environment that is conducive to increased investment and trade between India and Japan.
Business Opportunities Involved in India-Japan Trade Phenomenon
India and Japan maintain strong economic ties, with bilateral trade totaling $17.63 billion in 2016. The two countries have been working to further strengthen these economic ties and recently convened the India-Japan Annual Trade Ministers’ Meeting in New Delhi. As part of this meeting, the two countries released a joint statement reaffirming their commitment to economic partnership and cooperation.
In this section, we will take a look at some of the business opportunities that are involved in the India-Japan trade phenomenon.
The first opportunity that we will discuss is the export of Indian agricultural products to Japan. Agricultural exports from India to Japan totaled $1.27 billion in 2016, making up 7.2% of total Indian exports to Japan.
This figure has been increasing steadily over the past few years and is expected to continue to grow in the future as Japan looks to diversify its food sources. India is well-positioned to capitalize on this trend, as it is a major producer of many agricultural commodities that are in demand in Japan, such as rice, wheat, and spices.
Another business opportunity that exists for companies trading between India and Japan is the export of Indian pharmaceutical products to Japan. Pharmaceutical exports from India to Japan totaled $1.12 billion in 2016, making up 6.3% of total Indian exports to Japan. The Japanese pharmaceutical market is worth an estimated $125 billion and is expected to grow at a compound annual growth rate (CAGR) of 3
Conclusion
In conclusion, Exim Intell‘s expertise as a consultant has been instrumental in unraveling the intricacies of India’s product exports to Japan. Their comprehensive analysis and strategic guidance empower businesses to seize opportunities, navigate challenges, and forge strong trade relationships in this vital market. With Exim Intell as a trusted partner, companies can navigate the complexities of international trade with confidence and achieve their export goals.
