Japanese financial institutions have sought simplification of processes for profit repatriation, improving access to Indian capital markets and ensuring greater regulatory predictability for long-term investors in their meetings with Commerce and Industry Minister Piyush Goyal on Tuesday.
In Tokyo the talks between the minister and Japanese financial and investment institutions focussed on strengthening long-term capital flows, deepening investment partnerships and expanding Japanese participation in India’s growth story. The discussions assume significance in the context of the India-Japan objective of mobilising 10 trillion yen ($ 68 billion) of Japanese private investment into India over the next decade.
The Japanese institutions reiterated that their long-term strategic outlook on India remains strongly positive, while noting that currency movements and certain regulatory and policy considerations can influence short-term investment decisions.
While standard dividend payouts remain manageable, structural capital moves—such as share buybacks, capital reductions, and secondary equity sales—frequently run into extended regulatory delays, valuation scrutiny, and strict Reserve Bank of India (RBI) transfer-pricing guidelines.
Access issues to the Indian capital market involve limits on foreign investment in corporate and government bonds that reduce liquidity for low yield Japanese institutional capital seeking fixed-income allocation.
Japanese funds managing trillions of yen in long-term liabilities are seeking broader access to Indian fixed-income markets. India’s top-tier debt currently yields 6.5% to 9%, offering an attractive interest rate differential for capital originating from Japan’s low-yield environment.
Outside of specific frameworks like the Fully Accessible Route (FAR) (which opens designated G-Sec tenors to foreign investors without macro caps), investments are subject to strict short-term maturity caps and sector concentration limits.
At the meeting the Minister highlighted significant opportunities for Japanese investors in semiconductors, artificial intelligence, data centres, renewable energy, green hydrogen, advanced manufacturing and digital infrastructure
Goyal said India regards Japan as a trusted partner in its journey towards becoming a global manufacturing, technology and investment hub.
MUFG highlighted its investment of around $ 4 billion in Shriram Finance and its expanding interests in areas including renewable energy and hydrogen. DBJ outlined its dedicated India strategy and growing interest in property development, venture capital and other long-term investment opportunities.
Goyal emphasised that India is seeking not merely capital but long-term partnerships that bring technology, innovation, manufacturing capabilities, employment and integration with global value chains. He highlighted opportunities in both new and emerging sectors and established businesses requiring modernisation and technological upgrading.