India-Japan Trade Could Rise To USD 50 Bn by 2030 With Export Diversification: ASSOCHAM

New Delhi, Aug 27 (KNN) India-Japan bilateral trade could rise to USD 50 billion by 2030 from USD 27.47 billion in 2025-26, with greater export diversification, an upgraded trade agreement and deeper business engagement supporting the expansion, according to an ASSOCHAM report.

The industry body noted that bilateral merchandise trade has increased nearly 79 per cent from USD 15.36 billion in 2020-21 to USD 27.47 billion in 2025-26. However, the trade balance remains tilted towards Japan, with India importing USD 21.43 billion worth of goods and exporting USD 6.04 billion during 2025-26.

In the report, ASSOCHAM Chief Economist S P Sharma said, “ASSOCHAM believes that India Japan bilateral trade has the potential to reach USD 50 billion by 2030, supported by growing economic complementarities and deeper business engagement.”

Scope to Expand Indian Exports

India’s share of Japan’s total imports stood at just 0.93 per cent in 2025, indicating significant scope to increase exports to the Japanese market.

ASSOCHAM identified pharmaceuticals, chemicals, machinery and mechanical products, electronics and marine products as key areas for export expansion. 

India already has a stronger presence in organic chemicals and automobiles and auto components, where its shares of Japan’s imports stood at 6.33 per cent and 4.4 per cent, respectively, it noted.

The industry body said India should focus on higher-value products and, “rather than relying on traditional goods trade, both sides should push India’s exports up the value chain.” It also identified pharmaceuticals, IT services and renewable energy technology as areas with export potential.

Upgrade to Trade Pact, MSME Support Needed

The report called for an upgrade of the 15-year-old India-Japan Comprehensive Economic Partnership Agreement to address non-tariff barriers and improve market access for Indian businesses, particularly MSMEs.

It also recommended simplifying regulatory procedures, strengthening two-way technology transfer and integrating more Indian MSMEs into Japanese and global supply chains.

Japanese Investment Could Support Growth

Japanese investment is expected to provide an additional boost to bilateral economic ties. Japan has committed to invest JPY 10 trillion, or around Rs 5.5 lakh crore, in India over the next decade. More than JPY 2 trillion, or about Rs 1.1 lakh crore, has already been committed through 129 private-sector agreements, according to the report.

ASSOCHAM said deeper business engagement, stronger investment linkages and a shift towards higher-value exports could help India narrow the trade gap and move bilateral trade towards the USD 50 billion target by 2030.

(KNN Bureau)