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Japan Asks India to Restart Economic Activities, Allow its Companies to Resume Work

Japan has become one of the first few countries to reach out to India for resuming economic activities at the earliest. Japanese Foreign Minister Motegi Toshimitsu had a 30-minute long phone conversation with External Affairs Minister S Jaishankar on May 7, where he asked India for "cooperation for resumption of activities of Japanese companies in India." This comes as India enters day 45 of the Covid-19 pandemic-induced lockdown, which will continue for another 10 days.

According to sources, India responded to the request saying that it values the contribution of Japanese companies in the country and assured that their issues will be addressed. "We understand there have been some disruptions. We are working with the companies to address their concerns. As we go into post-lockdown gradually, depending on the Covid-19 situation, solutions to their issues will be found."

There are almost 1,500 Japanese companies in India. The total number of registered Japanese companies in India till October, 2018 was 1441. Almost half of these companies are engaged in the manufacturing sector. The year 2017-2018 also saw an almost 5 per cent growth of Japanese companies and businesses in India. Haryana has the maximum number of Japanese companies in the country followed by states like Maharashtra, Karnataka, Tamil Nadu and Delhi.

After the phone conversation with his Japanese counterpart, External Affairs Minister S Jaishankar had tweeted to say they 'dwelled on economic recovery challenges including supply chain resilience.'

India is hoping to take advantage of the negative sentiments prevailing against China since the outbreak of coronavirus as countries like Japan have said they may want to pull out investments from China. Under such circumstances, stepping up measures to ensure smooth resumption of businesses will be important now.

The Gujarat government said that it has already written to political and business authorities in Japan, inviting them to shift their commercial units and operations from China. In fact, it has announced a $2.2 billion economic stimulus package to help Japanese manufacturing units move out of China.

Meanwhile, Uttar Pradesh has passed an ordinance, "Temporary Exemption from Certain Labour Laws Ordinance, 2020" to exempt all establishments, factories, and businesses from the purview of all but four labour laws, for three years. This is to boost investment in UP in a post Covid-19 scenario.

Although, lockdown 3.0 has seen the Ministry of Home Affairs tweaking guidelines in a manner that economic activities can resume gradually but businesses have already suffered losses due to the lockdown. On the other hand, despite being hit quite early by Covid-19, Japan didn't go for full lockdown measures. An emergency was announced and then extended till May 31 but public transportation and air traffic remained functional. The argument for not opting for a full lockdown was that shutting down economic activities would make it impossible for people to make a living.

May 08, 2020

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