Fukushima fallout: Japan to go slow on nuke talks with India

Can you please give us a brief overview of the Japan-India relation and its prospects for future?

Japan’s relation with India has its roots in history. India is the place from which Buddhism spread to Japan almost 1500 years ago, via China and Korea, and, therefore, occupies a very special place in the hearts of the people of Japan. The two countries are now strengthening their ties as strategic partners, not just in this part of the world, but also in various arenas globally, and emerging as true ‘Global Partners’. The 2000 visit of the then Japanese Prime Minister Yoshiro Mori to India in fact marked a new beginning in the bilateral relation and it was re-affirmed that the two countries were indispensable strategic partners to each other. It was then decided that Prime Ministers of both countries would take turn to visit the other every year. Since then we have been making very hard efforts to strengthen bilateral relations in the political, economic and cultural areas. If you look at maps, Japan and India are located nearly 6000 kilometers away from each other. We have been treating each other as very important partners from the geo-strategic viewpoint. It is only natural that the two countries come close at the strategic level. We have a giant neighbour in common. There are many levels of dialogues between Japan and India. At the top, we have a dialogue between Prime Ministers. We have a strategic dialogue at the level of Foreign Ministers. We have just added another– a Ministerial Dialogue on Economic Issues to be led by Foreign Ministers, with participation of ministers holding finance, commerce and environment portfolios. We are now discussing a date and a venue to hold the dialogue. We have a Foreign Secretary level dialogue too. So we are looking forward to the intensification of consultations at all levels. Indian Defence Minister is expected to go to Tokyo sometime this year to hold talks with his counterparts in Japan. So, on a whole, I think we have very excellent bilateral ties and the future of our strategic partnership looks very promising.

India has been the top recipient of Japan’s Overseas Development Assistance. Do you think that the March 11 earthquake and tsunami can have an impact on the Japanese ODA inflow to India?

No. It is true that India has been the top ODA recipient from Japan for eight years in a row. And, for the year 2011-12, we have just received a request list for the ODA from the Indian Government and we are in the midst of examining it. We have just exchanged the notes for formalizing the Japanese soft loan assistance worth 155, 549 million yen (approximately Rs 8632 crore) to seven projects in India. This includes the 19832 million yen for the second phase of Bangalore Metro. The loan package was initially scheduled to be extended in 2010-11. There has been some delay due to the earthquake, I must admit. But Japan has extended the loan without any deduction from its previous commitment to India. For us, a commitment is a commitment and we honour our promise to India. I don’t think there will be any reduction in future ODA inflow from Japan to India due to the quake. You can count on us. The basic philosophy of our ODA loan is simply to help our good friend. If our good friend is building his own house and if he needs our help, we are more than happy to help.

As Japan itself is in the midst of a rebuilding process after the March 11 quake and tsunami, do you expect India to extend help to its good friend too? 

India has been doing a lot to help us, right from the beginning, at the first stage of our recovery efforts. And in future too, if necessary, we may ask our friends abroad to come and help us. But, right at the moment, I think we are handling the situation quite alright.

Can you give us an overview of Japan-India economic ties and its prospects after the signing of the Comprehensive Economic Partnership Agreement? Is the trade target of US $ 25 billion by 2014 achievable, after the recent disasters that hit the economy of Japan?

The answer is yes. I can only see a promising picture of future economic relation between Japan and India. Bilateral trade volume doubled in the last five years. The number of Japanese companies doing business in India also doubled in the last three years from 362 to 725 and it is still increasing. Every month the Japan Chamber of Commerce and Industries in India welcomes new members. The two countries signed CEPA on February 16 last and it will come into effect on August 1. Under the agreement, we have promised to eliminate 94% of tariffs between Japan and India within 10 years. Import duty will be zero on 90% of products coming from Japan to India and on 97% of exports from India to Japan. This will give Indian companies more business opportunities in Japan, particularly in pharmaceuticals and services sector. So the future looks very promising.

Can you update us about the status of the Dedicated Freight Corridor and Delhi Mumbai Industrial Corridor? Do you feel there should be some mechanism to ensure more opportunities to Japanese companies in these projects?

Japan is committed to the western DFC, between Delhi and Mumbai. For the first phase of the western DFC, we are already committed to the loan agreement and notes have been exchanged in March last year. The main loan amount is about 90 billion yen. Engineering service loan for the second phase has also been signed. So, as far as the DFC is concerned, agreements have been signed and the contractors are well informed and they are eager to actively take part in the implementation of the project. On the DMIC, there are some early bird projects. And the Japanese companies are very eager to take part in implementing the early bird projects. Also, there are Smart Community Projects. The feasibility studies have been conducted. Japanese companies have presented their proposals to the Government in Tokyo. And now the Japanese Government is studying the proposals.

Some companies may have mentioned about the problems about financing in rupee terms. Long-term rupee financing is not possible under the present scheme of the Indian Government. So how we go about this is something we need to work hard with cooperation with Indian Government.

As you are on a visit to Bangalore, may I ask you how you view the future of Japan-India cooperation in the Information Technology sector? Karnataka Government had a plan to set up a Japanese Village or an industrial park exclusively for Japanese companies near Bangalore. Can you please give us an update on its present status and some details about it?

I was very much looking forward to my visit to Bangalore. This is my first visit to Bangalore. The city has been very famous as an Information Technology hub. Bangalore Metro is one of the projects that received Japanese ODA. As many as 74 Japanese companies, including Toyota, Nissan and Komatsu, have presence in Bangalore. And I have been told that the number would rapidly increase in the coming days. I would be seeing the representatives of the Japanese business community in Bangalore. Bangalore is a very attractive destination for investments from Japan. We in Japan are keenly interested in strengthening our cooperation with India in the IT sector. The NASSCOM chief Som Mittal will visit Japan this week and he will meet government officials there. I hope he will have a productive visit that will help boost Japan-India IT collaboration further.

I know that Karnataka Government has a plan to set up an industrial park for Japanese companies near Bangalore. Many Japanese companies are interested to go there. The problem is that the land acquired by the State Government needs to be developed. I think private sector developers have to do the job. We are yet to hear the name of the developer. We are hoping that we will be able to find reliable, good developer.

Japan and India have decided to hold a Ministerial-level Economic Dialogue to be led by Foreign Ministers of both the countries. When will it happen? Can you please give us a broad outline of the issues that might be discussed in the Economic Dialogue?

It will happen this year. We want all top level dialogues between Japan and India to take place before our Prime Minister comes here to hold talks with your Prime Minister here later this year. I expect that long-term and strategic policy dialogue will have to take place at least at the cabinet level, including how to improve infrastructure, what types of finances will be available. Improving the business environment will be an issue of common interest for both sides at the minister level. We will pinpoint the specific issues to be discussed at a later stage.

Did the incidents at Fukushima-Daiichi nuclear plant in the aftermath of the March 11 earthquake and tsunami slow down the Japan-India talks on civil nuclear cooperation? Is the fact that New Delhi has not signed the Comprehensive Test Ban Treaty and the Nuclear Non Proliferation Treaty a cause for Japan to be cagey about striking a deal for civil nuclear cooperation with India? In the wake of the crisis in Fukushima-Daiichi Nuclear Plant, can Japan and India explore bilateral cooperation in nuclear safety?

Yes, our talks on civil nuclear cooperation did slow down to some extent, I must admit. We have to assess the impact of the accident that we observed in Fukushima. We certainly have to take into account what happened there. We have to look into the safety standards of the operation of nuclear reactors. Your Prime Minister also ordered a review of the safety standards at nuclear facilities. We are also doing the same. Unless and until we are more comfortable and certain that we can sit down again and talk about the civil nuclear cooperation between Japan and India, we don’t want to rush to the negotiating table. But we do recognize that we are becoming more and more dependent on nuclear energy. The core issue is how we can make the nuclear facilities safer and what kind of nuclear safety standards need to be introduced in our respective countries. In fact, Indian Environment Minister Jairam Ramesh during a conversation with me floated the idea of holding a workshop to discuss the lessons to be learnt from Fukushima. What has Japan learnt from Fukushima? What can India learn? We can do it bilaterally. We have already submitted a report to the International Atomic Energy Agency.

On the issues of CTBT and NPT, we respect India’s positions and India also respects Japan’s positions on nuclear issues. We have high regards for India’s commitments and India’s policies on nuclear energy. I do not see that there is an insurmountable problem in making progress in the talks on the Japan-India civil nuclear cooperation. I think we can do it.

Japan, India and the United States agreed to establish a trilateral dialogue on regional and global issues of shared interest. When do you think the trilateral dialogue can be launched? Can you please give us an idea about the broad contour of the trilateral dialogue, like the issues that it will address?

This is going to be a dialogue at the level of senior officials. India will be represented by Additional Secretary, Japan by Deputy Vice Foreign Minister and US by Assistant Secretary of State. We have agreed to initiate this dialogue. We are yet to decide the venue and date. They can touch upon some global issues, including climate change. But I think the dialogue will focus mainly on regional issues, like the situation in Asia. They can discuss regional architecture, including that in South East Asia. There is ASEAN plus six or eight. They are functioning in their own way. But is there any room for expansion of the concept of regional architecture? What kind of role is India going to play in Asia, not only in West Asia, but also in the eastern part of the continent? These are some of the issues that may be discussed in the trilateral dialogue.

There are reports indicating differences emerging among the G-4 countries on the process of reforms of the United Nations, particularly expansion of the Security Council, with Germany being inclined to opt for interim solutions in which some of the countries are accommodated without veto rights, while India and Brazil want to settle the issue once and for all. What is the position of Japan?

First of all, we need to come up with a tangible result during the United Nations
General Assembly session in September this year. We cannot keep on endlessly discussing about reforms of the United Nations, more particularly of the Security Council. There is a huge amount of support coming from member states of the UN for more balanced geographical representation in the Security Council. The G-4 has been playing a central role. We need to, we want to and I think we will be able to maintain solidarity in this attempt to reform of the UNSC. We are discussing among ourselves and we hope to wrap up the discussion by the next General Assembly session. We hope to come up with attractive proposals to be put on the table before the UNGA.

India has since long been urging Japan to ease its export control laws to facilitate high-technology trade between the two countries. Has there been any progress on the issue?

We have a quite a rigid export control laws on high-tech trade. There have of course been relaxations. And relaxations are taking place every year. Some progress has been made.