10/29/2010, 00.00
INDIA – JAPAN
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More trade and closer political ties between New Delhi and Tokyo

Singh’s visit to Tokyo marks the two nations’ increasing interest in closer economic and political co-operation. Talks focus on trade, investments and civilian nuclear technology. The two Asian nations are expected to develop closer political and military ties.

Tokyo (AsiaNews/Agencies) – The visit by Indian Prime Minister Manmohan Singh to Japan has opened the doors to a stable partnership and co-operation on civilian nuclear technology between the two Asian giants.

Mr Singh, who is now in Malaysia, signed the ‘India-Japan Comprehensive Economic Partnership Agreement (CEPA), which is expected to boost trade, investments and co-operation in a number of sectors. Japan has already signed a number of such deals, but for India, it is only the third; the first two were struck with Singapore and South Korea.

New Delhi remains cautious with broad agreements, fearing its domestic market might be swamped by foreign companies and goods to the detriment of domestic producers and products. In the case of Japan, it has to consider its huge trade deficit with the land of the rising sun.

Negotiations for a CEPA went several rounds of negotiations between January 2007 and September 2010 after a feasibility report prepared by a joint India-Japan study group.

The deal, which will eliminate tariffs on a number of items, is aimed at increasing the volume of bilateral trade, which currently stands at around “only” US billion.

New Delhi will expect greater Japanese investment for infrastructure development, such as roads, ports, airports and transportation.

The two parties also agreed to a joint declaration setting out a timeframe for a next round of negotiations on civilian nuclear cooperation. India needs nuclear technology and material, Japan wants guarantees on possible military use.

New Delhi plans to build 20 nuclear powers by 2020 to deal with its chronic shortage in electric power and Japanese companies do not want to leave the field to Russian and South Korean firms.

Singh and Japanese Prime Minister Naoto Kan "expressed optimism” for greater co-operation between the two nations, something that New Delhi was eager to achieve, less so Tokyo, hitherto more interested in China. However, the recent row with Beijing over maritime borders in the East China Sea and the issue of sovereignty over the Senkaku Islands have convinced Japan to reduce its reliance on China, one of its main trading partners and a market where Japanese companies are heavily involved. For Japan, the Indian market now offers brighter prospects at a time of economic recession in Japan.

It is significant that the final joint communiqué by the two leaders made note of the possibility of exploring "bilateral cooperation in development, recycling and re-use of rare earths and rare metals”. Until now, Japan bought the supplies it needed exclusively from China, but Beijing recently cut back on exports, a move seen by many as retaliation against Japan over maritime disputes.

The two prime ministers also discussed political and military issues, such as the expansion of the East Asian Summit to include the United States and Russia, and reform of the United Nations, both want a permanent seat on the Security Council.

The two countries also share a common interest in containing China’s growing naval power. India is increasingly displeased by close military ties between China and Pakistan, its traditional regional rival, especially the construction of a modern port in Gwadar, on Pakistan’s southeastern coast, on the Arabian Sea, which could become a terminal for extensive trade with the entire Arabian Peninsula.

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