Piyush Goyal says India open to expanding scope of Japan trade agreement
The Commerce and Industry Minister stated that India is open to expanding the scope, scale, and extent of the India-Japan Comprehensive Economic Partnership Agreement (CEPA)
The statement follows the 16th India-Japan Annual Summit held in New Delhi in July 2026, whose joint statement noted that more than 15 years had passed since the CEPA was signed and called for accelerating its review to make it "more forward-looking"
Discussions under the proposed review cover cooperation in semiconductors, artificial intelligence, clean energy, and advanced manufacturing, alongside traditional goods and services trade
Japanese textile companies, including a major global apparel retailer, plan to increase sourcing of input material from India and step up investment
India also aims to support Japan's stated ambition of doubling the number of Japanese companies operating in India
India-Japan CEPA (2011) — Structure and Coverage
The CEPA under review is one of India's oldest comprehensive trade agreements with a major economic partner, and its structure differs meaningfully from narrower trade pacts.
Key Details
- Signed in Tokyo on February 16, 2011; entered into force on August 1, 2011
- Covers trade in goods and services, movement of natural persons, investment, intellectual property rights, and customs procedures — broader than a goods-only Free Trade Agreement (FTA)
- Envisages elimination of tariffs on approximately 94% of items traded between the two countries over a 10-year phase-out period
- A Joint Committee established under the agreement oversees implementation and review
The "review" being accelerated is a structured renegotiation of specific chapters of this 2011 text — not a new agreement — reflecting how CEPAs are designed to be periodically updated as trade priorities evolve.
India's CEPA/FTA Portfolio — Comparative Framework
Distinguishing CEPA from other trade-agreement formats India has signed helps place the Japan agreement in context.
Key Details
- CEPA (Comprehensive Economic Partnership Agreement): broad coverage of goods, services, investment, and IPR — examples include India-Japan CEPA (2011) and India-UAE CEPA (2022)
- ECTA (Early/Economic Cooperation and Trade Agreement): narrower, often an interim step — example: India-Australia ECTA (2022), being upgraded toward a full CECA
- TEPA (Trade and Economic Partnership Agreement): India-EFTA TEPA (2024), notable for linking investment commitments to market access
- Nodal ministry for negotiating and reviewing all such agreements: Ministry of Commerce and Industry, Department of Commerce
Expanding the Japan CEPA's "scope and scale" places it in the same comprehensive category as the UAE agreement, rather than converting it into a narrower interim arrangement.
Japan-India Special Strategic and Global Partnership and Investment Facilitation
The CEPA review sits within a broader institutional architecture of India-Japan ties built up over two decades, which is what enables sustained high-level trade dialogue.
Key Details
- Bilateral ties were elevated to a "Global Partnership" in 2000, followed by the launch of an Annual Summit mechanism in 2006 (the two Prime Ministers meet yearly, alternating as host)
- Relations were upgraded to a "Special Strategic and Global Partnership" in 2014
- "Japan Plus," a dedicated investment-facilitation cell under India's Department for Promotion of Industry and Internal Trade with representatives from Japan's Ministry of Economy, Trade and Industry (METI), was operationalised on October 8, 2014, to fast-track Japanese investment proposals
- Japan is India's fifth-largest source of cumulative FDI, with inflows exceeding $47.59 billion between April 2000 and December 2025 (about 6.69% of India's total FDI inflows)
The Uniqlo and broader textile-investment interest cited alongside the CEPA discussion is a direct output of this Japan Plus facilitation architecture and the annual summit's investment-promotion track.
India's Textile Manufacturing Push — PM MITRA and PLI
The specific interest of Japanese textile firms in sourcing from India connects to India's own domestic manufacturing incentive framework for the sector.
Key Details
- The PLI Scheme for Textiles (approved 2021) covers Man-Made Fibre (MMF) apparel, MMF fabrics, and technical textiles, with an approved outlay of ₹10,683 crore over five years
- The PM MITRA (Mega Integrated Textile Region and Apparel) scheme has approved seven integrated textile park sites — in Karnataka, Madhya Pradesh, Maharashtra, Tamil Nadu, Telangana, Uttar Pradesh, and Gujarat — to build integrated, world-class textile manufacturing hubs
- Together, PM MITRA and the textiles PLI are projected to draw around ₹95,000 crore in investment over the next few years
Increased Japanese textile-sector sourcing and investment in India dovetails with this existing domestic push to scale up integrated textile manufacturing capacity.
- India-Japan CEPA: signed February 16, 2011; in force from August 1, 2011; ~94% tariff lines to be liberalised over 10 years
- 16th India-Japan Annual Summit: held July 2026, New Delhi
- Annual Summit mechanism established: 2006; Special Strategic and Global Partnership: 2014; Japan Plus cell operationalised: October 8, 2014
- Japan's rank as source of FDI into India: 5th largest; cumulative FDI (April 2000-December 2025): over $47.59 billion (~6.69% of total FDI inflows)
- India-Japan bilateral trade: approximately $27.5 billion (2025-26)
- Textiles PLI outlay: ₹10,683 crore; PM MITRA: 7 approved park sites; combined projected investment: ~₹95,000 crore