Japan Moves Chip & Battery Manufacturing to India to Cut

Japan and India are taking a big step together to move some of Japan’s older technology manufacturing to India. This plan involves shifting the production of legacy semiconductors, liquid crystal displays (LCDs), and batteries from Japan to India. The main goal is to reduce their dependence on China for these products and to create a stronger economic partnership between the two countries.

Legacy technologies refer to older manufacturing methods and equipment that have been used for years but are still important. For example, these legacy semiconductors are used in electric vehicles for controlling voltage and also in appliances, like air conditioners and refrigerators, to improve energy efficiency. Since these methods are mature and less complex compared to the newest technologies, it is easier and cheaper to move production to India.

Japan and India’s plan has been developed by the Japan External Trade Organization (JETRO) and the Confederation of Indian Industry. It will be officially announced soon, coinciding with the visit of India’s Prime Minister Narendra Modi to Japan for a summit with Japan’s Prime Minister Shigeru Ishiba. They plan to not just shift production but also build up India’s manufacturing capacity while reorganizing Japan’s.

Currently, India imports many electronic components from China. By moving production there, India hopes to grow its own manufacturing sector and become less dependent on China. At the same time, Japan benefits by cutting costs because India offers cheaper labor, and it helps Japan stay competitive despite low-priced Chinese products.

This move shows how complex global trade and politics have become. While India has closer economic ties with China recently, partly due to tariffs imposed by the US, Japan’s effort to build stronger economic links with India offers New Delhi an alternative partner. It’s a way to balance relationships and keep strategic independence in technology and manufacturing.

Japanese companies have already started making investments in India aligned with this plan. For instance, a Japanese battery maker is planning joint production with an Indian company, and an electrical machinery company is building a compressor plant in Tamil Nadu, southern India. These investments promise job creation and knowledge sharing, strengthening India’s position in the global supply chain.

From a broader perspective, this development highlights a shift in global manufacturing where countries are trying to diversify their supply chains and reduce risks associated with depending on a single country, especially China. For India, it is a big opportunity to develop its technology manufacturing industry by combining Japanese expertise with India’s cost advantage.

In simple terms, this partnership means Japan will send some of its important but older technology factories to India. This benefits Japan by cutting costs and avoiding over-reliance on China, while India gets a chance to grow its own industry and create jobs. Both countries hope this teamwork will make their economies stronger and more secure in a world where global trade patterns are changing fast.

With inputs from agencies

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