February 18(Friday)

Signing a Comprehensive Economic Partnership Agreement with India!

Vigorously advancing the "21st-century opening up of Japan"

 

The "21st-century opening up of Japan" has taken yet another major step forward in concrete terms.

 

Today (February 16), Japan and India signed a comprehensive economic partnership agreement (EPA). India is the world's second most populous country, with 1.17 billion people (according to 2007 United Nations statistics). This step is of great importance in achieving growth jointly with vibrant India. In the days to come, procedures will be undertaken to secure approval in the Diet in order to have this agreement enter into force at the earliest possible date.

 

What's an "EPA"?

 

An "EPA" is an arrangement for economic cooperation (an "economic partnership agreement") concluded between one country and another. By both countries lowering tariffs to 0% for almost all goods, not only do imports and exports become dramatically liberalized, but also the participating countries seek to liberalize cross-border remittances, eliminate investment regulations, and enhance systems for intellectual property protection, among other goals. This EPA with India is the twelfth one Japan has concluded, following upon agreements signed with Thailand, Mexico, the Association of Southeast Asian Nations (ASEAN), and others.

 

Importance of strengthening economic relations with India

 

India enjoyed an 8.6% rate of GDP growth in the previous fiscal year (expected, based on Central Statistical Organisation [CSO] of India documents). India's middle class is also expanding, with, for example, the number of cars owned in 2007 having increased to roughly 1.8 times the number owned in 2003.

 

Yet despite such striking growth, economic relations between India and Japan do not at present reflect the scale of these two countries' economies.

 

For example, India accounts for a roughly 0.85% share of Japan's trade value, making it Japan's 28th largest trading partner (as of fiscal 2008). Moreover, India ranks only 20th among countries receiving Japanese investment.

 

Structure of trade between Japan and India
Structure_of_trade_between_japan_an

 

With a view to opening wide the gates to such economic relations, through this EPA we have negotiated a landmark agreement that removes tariffs on a remarkable approximately 97% of imports from India and approximately 90% of exports to India within ten years of the agreement entering into force.

 

So, what really changes?

 

As a result, among goods imported from India, tariffs on virtually all categories of goods within industrial fields will be lifted immediately, and tariffs will also be removed on curry, teas, shrimp, and other items with which we are well acquainted in our daily lives.

 

In other words, Japanese consumers will be able to buy these imported goods more cheaply.

 

P201102162

Today, the staff at the Prime Minister's Office had the opportunity to enjoy Indian food at lunchtime.

 

At the same time, among Japan's exports to India, over a span of ten years tariffs will be lifted on, for example, automobile parts (bumpers, ignition coils, and so on), lithium-ion batteries, and DVD players, as well as agricultural goods such as strawberries, peaches, and persimmons, among others. Japan will become able to export these categories of goods to India under more favorable terms.

 

In addition, it will be easier to take business trips, accept new cross-border job assignments, and travel for investment purposes between the two countries.

 

What's more, Japan is also moving forward in considering economic partnership with India under the framework of ASEAN+6 (the members of ASEAN plus Japan, China, the Republic of Korea, India, Australia, and New Zealand), and today's agreement will be a foothold towards achieving such a goal.

 

Negotiations with India

 

EPA negotiations with India spanned three years and nine months over a total of 14 meetings held alternately in Tokyo and Delhi. Agreement in principle was reached at the meeting held last September 9, and on October 25, Prime Minister Kan held talks with Dr. Manmohan Singh, Prime Minister of India, at the Prime Minister's Office in Tokyo, and signed a Joint Declaration on the conclusion of negotiations. After that, a dinner banquet was held with Prime Minister Singh and his wife and other relevant persons as guests.

 

P201102163    P201102164

Prime Minister Kan shaking hands        Prime Minister Kan delivering  
with Prime Minister Singh of India        an address at the banquet   

 

In the address he delivered at the banquet on this occasion, Prime Minister Kan said, "Our comprehensive economic partnership agreement will further expand trade

 

and investment opportunities as well as exchanges between our two countries. I pledge to continue to work to the best of my ability together with Prime Minister Singh towards the strengthening of Japan's relations with India."

 

Mr. Seiji Maehara, Minister for Foreign Affairs, and Mr. Anand Sharma, Minister of Commerce and Industry of India, signed the agreement this morning at the Ministry of Foreign Affairs. The doors to the expansion of future business opportunities for our two countries have finally opened.

 

The "21st-century opening up of Japan" will continue to advance steadily, one step at a time.

 



Latest 5 entries
August 29, 2011
Matters undertaken by the Kan administration:
A general report (5)
Recovery and reconstruction from the great earthquake disaster and transforming Japan's energy policy
August 29, 2011
"Final [Last Spurt] 'Until My Last Day as Prime Minister' ... Activities before Resignation and Beyond."
August 28, 2011
Matters undertaken by the Kan administration:
A general report (4)
Diplomacy and National Security
August 27, 2011
Matters undertaken by the Kan administration:
A general report (3)
Measures Taken from the Point of View of the People as Members of Society at Both the National and Local Levels
August 26, 2011
"No. 27 [Conversion] The Bill to Promote Renewable Energies Finally Passed! Comments from the Prime Minister and Citizens Awaiting its Passage."