India and Japan on Thursday unveiled a series of major agreements covering defence, artificial intelligence (AI), critical minerals, energy and investment during the 16th India-Japan Annual Summit in New Delhi.
Prime Minister Narendra Modi and his Japanese counterpart Sanae Takaichi also announced a new economic partnership framework and an economic security declaration. The two sides signed multiple agreements aimed at expanding cooperation in emerging technologies, defence manufacturing and resilient supply chains.
India-Japan defence agreement
The biggest announcement was the launch of the first India-Japan defence co-development project. The project involves the UNICORN (Unified Complex Radio Antenna) mast for the Indian Navy. The UNICORN antenna system will be installed on Indian Navy warships as part of the project.
According to the Manohar Parrikar Institute for Defence Studies and Analyses (MP-IDSA), the Indian Navy currently uses Bharat Electronics Limited’s (BEL) Advanced Composite Communication System (ACCS), a fourth-generation integrated voice and data communication system for external communications.
While the existing system is reliable, MP-IDSA said the UNICORN, also known as the Nora-50, offers advanced stealth features that improve the security of naval communications, an important advantage in modern electronic warfare.
The antenna combines multiple communication functions into a single structure and is designed to reduce a warship’s radar signature.
The two countries had signed a Memorandum of Implementation for the project in Tokyo in November 2024. Thursday’s agreement marks the operational launch of the initiative. Both sides also agreed to jointly develop future defence technologies to strengthen maritime security and regional stability.
What did Japan say?
Prime Minister Sanae Takaichi said India and Japan should build on their strengths as two of the world’s largest democratic and market economies.
She said both countries share the goal of promoting a free, prosperous and rules-based Indo-Pacific. According to Takaichi, the agreements announced at the summit will contribute to peace, stability and economic growth across the region.
Existing India-Japan defence services exchange
India and Japan have steadily expanded defence cooperation through regular military dialogues, joint exercises and high-level engagements across all three services. The Indian Armed Forces hold regular Staff Talks with the Japan Self-Defense Forces (JSDF), providing a platform to improve interoperability, strengthen operational coordination and expand defence collaboration.
According to the government of India, the Indian Navy and the Japan Maritime Self-Defense Force (JMSDF) conduct the bilateral Exercise JIMEX every year and also operate together in multilateral exercises such as Malabar and MILAN. The Indian Air Force and the Japan Air Self-Defense Force (JASDF) regularly participate in Exercise Veer Guardian and Shinyuu Maitri, besides joining other multinational drills.
On land, the Indian Army and the Japan Ground Self-Defense Force (JGSDF) hold the annual Exercise Dharma Guardian, with each edition becoming more complex and operationally demanding.
Investment plan from Japan
Japan is expected to announce investments worth nearly ¥2 trillion (around $12.5 billion) through about 120 cooperation agreements linked to the summit.
Prime Minister Modi said the two countries have set an ambitious investment target. “Our goal is to attract 10 trillion yen in investment from Japan to India and double the number of Japanese companies operating in India over the next decade,” he said.
The leaders also welcomed an agreement between the financial regulators of both countries. The arrangement is expected to make capital flows and investments easier.
The investment push is expected to support India’s manufacturing ambitions and encourage more Japanese firms to expand operations in the country.
AI and critical minerals a priority
Several agreements focused on sectors that are becoming central to economic and strategic security.
The two countries also signed a joint statement on cooperation in artificial intelligence (AI), a Memorandum of Cooperation between the Geological Survey of India and the Japan Organisation for Metals and Energy Security for geological and mineral exploration and an agreement on battery technologies. They also agreed to expand cooperation in pharmaceuticals and medical devices, besides signing an agreement to boost the production and use of biogas and organic fertilisers to strengthen energy security and sustainable mobility.
Critical minerals such as lithium, cobalt and rare earth elements are essential for batteries, electric vehicles, semiconductors and defence equipment. Both countries are looking to build secure supply chains and reduce dependence on limited suppliers.
AI has also emerged as a key area of cooperation as India and Japan seek to strengthen partnerships in trusted technologies.
A look at India-Japan trade relations
Economic ties between India and Japan have continued to deepen, although the relationship still accounts for a relatively modest share of each country’s global trade. Bilateral trade stood at $27.47 billion in FY 2025-26, with Japan exporting goods worth $21.43 billion to India and importing $6.04 billion, a sizeable trade surplus in Tokyo’s favour.
According to official government data, India accounted for 1.75% of Japan’s total trade, ranking as its 14th-largest trading partner, while Japan was India’s 10th-largest trading partner with a 2.26% share. India also ranked eighth among destinations for Japanese exports, whereas Japan stood 21st among India’s export markets. On the import side, Japan was India’s 10th-largest source of imports, while India ranked 22nd among Japan’s import partners.
Japanese FDI into India
Japanese FDI into India has grown but it’s still a small slice of Japan’s global outward investment. The numbers are as follows: US$3.1 billion in 2023-24, US$2.48 billion in 2024-25, and US$3.2 billion in 2025-26 (through December 2025), government data showed.
Cumulatively, since 2000, Japan has poured roughly US$44.97 billion into India as of June 2025. That makes Japan the fifth-largest FDI source for India. Key sectors of investment include automobiles, electrical equipment, telecom, chemicals, financial services (insurance) and pharma.