The second India-Japan Finance Dialogue in Tokyo last week marked a significant step in enhancing bilateral financial cooperation between the two nations. High-level government officials and regulators gathered to discuss international financial issues and explore ways to deepen strategic economic ties.
The dialogue was jointly chaired by Atsushi Mimura, Japan’s Vice Minister of Finance for International Affairs, and Ajay Seth, Secretary of the Department of Economic Affairs, Government of India. Senior representatives from the Ministries of Finance, the Financial Services Agency of Japan, the Reserve Bank of India, and regulatory bodies such as the Securities and Exchange Board of India (SEBI), Pension Fund Regulatory and Development Authority (PFRDA), and Insurance Regulatory and Development Authority of India (IRDAI) were in attendance.
Key discussions focused on macroeconomic developments in both countries, third-country cooperation, and global financial issues. The participants also deliberated on sector-specific topics such as regulation, supervision, and digitalization, emphasising financial sector reforms. Notably, a special session with Japan’s financial services industry leaders highlighted the potential for expanding Japanese investments in India, addressing regulatory concerns and opportunities.
The next round of the Finance Dialogue is slated to take place in New Delhi.
Over the past year, Indian companies, including JSW Steel, Rural Electrification Corporation (REC), Power Finance Corporation (PFC), and Housing and Urban Development Corporation (HUDCO), collectively raised over ¥200 billion (approximately INR 11,000 crore) through yen-denominated debt. REC emerged as the largest borrower, securing ¥153 billion (INR 8,390 crore) across three debt facilities since January 2024.
State governments in India have also been tapping into Japanese financial resources. In April 2024, Tamil Nadu secured a $300 million yen-denominated loan from the World Bank for urban water and sanitation development. Additionally, the Power Finance Corporation recently obtained a ¥25.5 billion loan from the Japan Bank for International Cooperation (JBIC) to finance a wind energy project in Karnataka.
