No doubt this was a trailblazer for subsequent investments by other auto companies. The Japanese always had a long list of complaints and issues that needed to be resolved. They continued to view India as a large and growing market for export of capital and technology but not direct foreign investment. They were hesitant to look beyond the ASEAN region and viewed China with its insatiable appetite adequate to absorb their investment propensity.

I remember at least two exercises post economic liberalisation in 1991 to specifically address Japan-related issues. Many of these represented our endemic weakness and could only be addressed in a somewhat broader context. Quite a few of these have now been resolved.

The presentation made by Mikio Sasaki, chairman of the board of Mitsubishi Corporation, at the recent seminar therefore came as a pleasant surprise. He was realistic enough to recognise that India’s exports and imports from Japan were a modest 2.4 per cent and 2.5 per cent of the total, and direct investment to India only half a billion dollars, against $6 billion to China during 2006.

There were other startling contrasts: The number of tourists visiting Japan was just 14,000 from India, compared to 200,000 from China; the number of students studying in Japan just 410 compared to 480,000 from China; and the number of Indians studying Japanese was 5,000, compared to 300,000 from China. The two-way flight connections per week are just 11, against 676 from China.

Notwithstanding these contrasts, the presentation highlighted three issues which cause concern to Japanese companies: Infrastructure inadequacy, a complicated legal and taxation system, and insufficient regulations for inter-state transactions.

... contd.