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The number of Japanese companies doing business in India has reached 672, increasing 2.7 times over the last five years, according to Teikoku Databank, Ltd.
By type of business, manufacturers hold a share of more than 50%, and by annual sales, enterprises earning \10 billion or more account for approximately 70%.
A growing number of Japanese companies are expanding into and enlarging their activities in the Indian market, although they are not many in number yet, said Teikoku Databank.
As domestic demand in Japan is not expected to improve significantly for the time being, it is projected that Japanese firms will find rays of hope in India and other Asian economies where potential demand is high.
The Tokyo-based credit research company anticipates that India will become more and more important in the international community, not only as a low-cost production base after China, but also as an emerging consumer market.
By type of business, Teikoku Databank said, manufacturing companies amount to 382, which is three times as many as five years ago.
Among them, which hold a share of more than 50% (56.8%) of the 672, those engaged in producing machinery, electrical appliances, and motor vehicles and/or auto parts and components are major forces, which number 99, 65 and 58, respectively.
Manufacturers were followed by wholesalers, which total 121 and hold a share of 18%, and service providers, 76 and 11.3%.
Transport and telecommunication companies number 39, swelling 3.5 times from five years ago, but in terms of share, they do not organize a big group yet, accounting for a mere 5.8%.
By annual sales, approximately 70% of the 672 Japanese businesses earn \10 billion or more but less than \100 billion, or more than \100 billion, indicating most of them are large-scale enterprises, according to Teikoku Databank.
On Feb. 16, 2011, Japan concluded an economic partnership agreement (EPA) with India.
The EPA is hoped to provide opportunities for many Japanese firms to enlarge their business operations.
