Prime Minister Narendra Modi receives Japanese Prime Minister Sanae Takaichi at Hyderabad House ahead of bilateral talks, in New Delhi, Thursday, July 2, 2026. (PTI Photo)A statistic often cited to illustrate the underperformance of India-Japan business relations, despite the otherwise flourishing strategic partnership, is the number of Japanese companies operating in India — 1,500. Thailand, in contrast, has around 6,000 Japanese companies.Of the 1,500 in India, just 1% account for over half of all business. And most of this business, in turn, comes from a single sector — automobiles — thanks largely to the early commitment to India by Suzuki Motor Corporation in the 1980s.However, as someone who has lived and worked at the heart of corporate Japan for over a decade — after similar tenures at Indian and Western corporations — and led a period of rapid growth in the Indian business of a major Japanese corporation, I can testify to both the feasibility and attractiveness of trade and investment between the countries. More Japanese companies than ever before are now making efforts to do business in India, noticing the steady growth of the Indian economy despite global challenges, and realizing that India offers stability in an increasingly uncertain world.There is a subtle but telling shift in that a small number of the best Japanese corporations are now sending their most capable Japanese staff — a precious resource — to explore opportunities in India. There has been much investment in real estate, technology startups and steelmaking. Prime Minister Sanae Takaichi has brought welcome support to Indo-Japanese clean energy partnerships, among others. The fruits of all these endeavors will be visible in the coming years.Also Read | Tokyo, Delhi to deepen strategic ties, Takaichi flags global uncertaintyHow Japanese firms can adapt to IndiaThe most valuable assets of the Japanese when it comes to doing business in India are their ability to persevere and their resilience. India is no easier a place to do business in for the Japanese as Japan is for foreign corporations and these qualities are essential for success.To these they must add adaptability and the ability to develop strong Indo-Japanese teams. The key to success in India — as in the case of Maruti Suzuki, Reliance’s Jio telecom service and others — is to provide products and services suited to Indian conditions, competitively priced and produced on a large scale; quality is vital but must come at a price the consumer is willing to pay.Story continues below this adMany Japanese companies insist on applying traditional Japanese ways of doing business in India — whether it comes to product designs or speed of response to customer requests — and lose out to more nimble competitors, including Indian ones. As I remind Japanese colleagues, it is companies that must adapt to the countries they wish to do business in, and not the other way around.Also Read | What to know about India-Japan ties as PM Sanae Takaichi visits IndiaMany Japanese corporations have become accustomed to operating in China which efficiently ‘packages’ everything necessary to ‘plug and play’ in the country — from industrial plots to construction contractors to trained workers to well-developed vendor bases to seamless logistics. In India, foreign companies have to roll up their sleeves and figure things out for which hiring and motivating capable Indian staff is essential. Japanese companies often make local hiring decisions in relation to foreigners based on possession of a “pleasant personality, that is, a compliant attitude rather than one needed to win in a tough market and to develop a better understanding of India, which occasionally entails challenging entrenched cost structures or inefficient business processes or nudging mid-level managers at Tokyo headquarters outside their comfort zones.It is almost unheard of for Indians to head even the India operations of Japanese multinationals, let alone taking global responsibilities. In contrast it has been commonplace for decades for Western multinationals to recruit the best talent in India, provide it with the same career opportunities as anyone else, promote based on globally-benchmarked merit and deploy it globally. As a result, Japanese companies rarely attract quality Indian talent. The solution to these problems lies in reform within Japanese corporations, which requires careful handling but also determined corporate leaders capable of treading a path that may be unpopular internally. Such reform will stand Japanese corporations in good stead not only in relation to India but also within Japan and globally.Must Read | What to know about India-Japan ties as PM Sanae Takaichi visits IndiaWhat Indian companies can doStory continues below this adJapanese corporations are far more active in relation to India than Indian corporations are vis-à-vis Japan. Although the governments of India and various states, industry associations and the like actively market India to Japan, it would be helpful to focus more deeply and actively support Japanese investors in India, especially first-timers in select sectors. Partnerships utilising all available capabilities — not only government agencies — to create support structures that can deliver results on the ground are needed.Corporate India would benefit by engaging with Japan more strategically and intensively. It is rare to find an office in Tokyo of even the biggest names among Indian firms, or even a part-time local advisor. Consequently, there is a lack of understanding of the Japanese mindset and of how business can be developed here. Japan PM Sanae Takaichi (left) was received by MoS Dr Jitendra Singh. (Photo: X/@MEAIndia)Indian companies still look for old fashioned ‘collaborations’ or ‘transfers of technology’ in return for enabling ‘access’ to the Indian market by navigating bureaucratic complexity; this does little justice to India’s image, achievements and potential.The Japanese are swayed less by the prospect of high profit or growth — important though these are — and more by their estimation of the people they may do business with. The ability to listen, to develop shared understanding, to stand by one’s commitments and to let achievements — not words — speak for oneself, are the behaviors that are respected. I believe Indian corporations can fruitfully leverage reciprocal opportunities to bring their products and services to Japan or jointly to third countries, and develop partnerships with Japanese firms to enhance their own research & development and other capabilities. Japanese firms, on an average, spend over 4% of their revenues on research and development compared to the Indian average of under 1%. This is why, despite its much smaller population and lack of natural resources, Japan remains a top global economy.Story continues below this adThe author, a Tokyo-based management advisor, has worked at the seniormost levels of Japanese industry.