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Japan, India agree on tighter ties

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Japan and India pledged closer strategic ties between Asia's second and third biggest economies in talks on Oct 25, 2010. Japan and India pledged closer strategic ties between Asia's second and third biggest economies in talks on Monday.

Indian Prime Minister Manmohan Singh and Japanese Prime Minister Naoto Kan endorsed a bilateral economic partnership deal and urged speedy agreement on a civil nuclear pact that would give Japanese firms access to India's fast-growing market.

India's Prime Minister Manmohan Singh (L) and Japanese Prime Minister Naoto Kan attend a joint news conference in Tokyo Oct 25, 2010. Japan and India pledged closer strategic ties between Asia's second and third biggest economies in talks on Monday.[Agencies]

They also decided to seek cooperation in developing, recycling and finding substitutes for rare earth minerals and rare metals, used in goods such as electronics and auto parts.

"India is the world's biggest democracy and it currently has the world's second biggest population. Its growth potential matches that of China," Kan told reporters after meeting Singh. "Japan-India ties have great possibilities."

Sino-Japanese relations deteriorated sharply last month after Japan detained a Chinese trawler captain whose boat collided with Japanese patrol ships near a chain of disputed islands in the East China Sea.

"Japan wants to cultivate India as a strategic partner to offset problems in its relationship with China," said Jeffrey Kingston, director of Asia studies at Temple University's Japan campus.

Trade between Japan and India, Asia's second and third biggest economies, totalled 940 billion yen ($11.55 billion), four percent of Japan's trade with China.

In September, Tokyo and New Delhi clinched a basic accord on an economic partnership agreement (EPA) to promote two-way trade and investment, concluding more than three years of wrangling over such sticking points as tariffs on Japanese car parts and tough checks on Indian pharmaceutical goods.

"I strongly believe that we can, and we must, synergise our complementary stance to impart new momentum to Asia as well as global economic growth and prosperity," Singh, in Tokyo until Tuesday, told a group of business leaders from both countries.

He also said he hoped Japan's decision to treat Indian generic drugs the same as domestic products and finish approval procedures smoothly would create new business chances for India drug companies including makers of generic medicines.

Japan has been stepping up efforts to strengthen overall ties with India, with the two countries agreeing on closer security cooperation in December 2009.

They also started talks in June on a civil nuclear energy deal that would give Japanese firms access to the rapidly growing market amid rising global competition.

Firms from countries such as the United States, France and Russia have scrambled for a foothold in India's civilian nuclear market, worth about $150 billion, after a 2008 US nuclear accord opened global access to it.

But Japan, the only country to suffer a nuclear attack, wants the deal to make clear that Tokyo would halt nuclear cooperation if New Delhi conducted another test, Japanese media have said, a stance India has so far rejected.

Kan said India understood Japan's nuclear sentiments and that the two countries will work to speed up negotiations on the deal.

They also agreed to hold annual ministerial economic talks.