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Japanese Prime Minister Shinzo Abe and his Indian counterpart Manmohan Singh pledged to deepen ties in trade and investment between the two countries. Abe is on a visit to India with a 200-strong business delegation (see earlier report ‘Japan for more business ties with India').
The two countries will sign a bilateral agreement on a currency swap, and work towards more than tripling bilateral trade to $ 20 billion by 2010. Trade between the two countries in 2006 was around $ 6.5 billion.
India's Minister for Commerce Kamal Nath told a joint India-Japan business forum in New Delhi that ongoing negotiations on a Comprehensive Economic Partnership Agreement (CEPA) would be completed by the end of 2007. Earlier, addressing the Indian Parliament, Abe had asked for CEPA negotiations to be speeded up.
A trade agreement would give Japanese companies, including Hitachi Ltd and Bridgestone Corp, greater access to the world's second-fastest growing major economy, helping them weather slowing export growth to China, the US and Europe.
The bilateral agreement on a currency swap will provide emergency financial liquidity to either or both countries in times of currency market or other turbulence.
The agreement will also enable both countries to swap foreign currencies like the US dollar or the euro to maintain the value of the rupee and yen in foreign exchange markets.
The Japanese prime minister also pledged Japanese financial aid for infrastructure development in India, particularly a freight corridor linking the major cities of New Delhi, Mumbai and Kolkata, and the $ 90 billion Delhi-Mumbai Industrial Corridor.
Japan is the fifth major investor in India. India's exports to Japan in 2006-07 stood at $ 2.81 billion, while imports from Japan totalled $ 4.56 billion.
August 23, 2007
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