“JICA projects to help Indian private sector break into Southeast Asia”

NEW DELHI : Key infrastructure projects funded by Japan, such as the port of Matarbari in Bangladesh, should provide an entry point for Indian companies to set up in Southeast Asia, said the senior vice president of the ‘Japan International Cooperation Agency, Nakazawa Keiichiro. By establishing a deep-water port in Bangladesh, JICA hopes to connect India’s northeastern states with markets in the Bay of Bengal region, Keiichiro said in an interview. In an in-depth review of Japan’s global development assistance plans, JICA hailed India’s contributions to infrastructure construction in East Africa. This comes as the Japanese development agency seeks to increase its global investment in private sector projects to $15 billion in the coming years, with a focus on Indian projects. Edited excerpts:

What projects is JICA currently seeking to promote in India?

JICA has worked in India since the late 1950s. In the early decades, we helped import electrical equipment and build many power projects to help industrialize the country. During the economic crisis of 1991, we provided $300 million in balance of payments support. Today, most of our collaboration with India is in the infrastructure sector. We are also proud of our forest restoration projects.

What projects do you have for the future?

Looking to the future, we are certainly looking at renewable energy projects. India seeks to achieve net zero emissions by 2070 and also wants to provide electricity to the most vulnerable sections of society. Renewable technologies such as green hydrogen and carbon capture technology are being explored globally, but we are very keen to help introduce these technologies once they are economically viable.

We are also looking to increase our cooperation with the private sector. Even though our loans are concessional, the Indian government is careful not to increase the level of debt too much. We will now seek to finance or make equity investments in private projects.

We have been doing this since 2011 and have six projects in the works with a total exposure of $400-500 million. Most of these projects fall into the area of ​​social impact. Overall, we have committed approximately $10 billion to private sector projects and we plan to increase this amount to $15 billion over the next few years.

Some JICA projects like the port of Matarbari seemed very promising for the district. What is the thinking behind these connectivity efforts?

The development of the Bay of Bengal is very important for India and other countries in the region like Bangladesh, Myanmar and Thailand. We are helping the government of Bangladesh to build the port of Matarbari because the country does not currently have a good deep water port. With Matarbari, we would have a port that could be used by the government and the Indian private sector as a central point to deliver goods to parts of Southeast Asia.

We hear about the possibility of a global recession looming in Europe and America. What impact is this likely to have on your organization’s projects in India?

I just participated in the annual meeting of the IMF and the World Bank in Washington last week. The good news is that even though the global economy is uncertain due to inflation and the war in Ukraine, India’s growth will be very strong by many estimates. The Asian Development Bank estimates it will be around 7%. India has been and will be an engine of global growth. JICA will seek to support this growth. India is a very important country not only for Japan but for the world.

India and Japan have also cooperated to build infrastructure globally. How successful have these efforts been?

In parts of East Africa like Kenya which speak English, many members of the Indian diaspora live and work in these parts of the world. As such, India has a great knowledge of the culture and what needs to be done. So there is an opportunity for India and Japan to work together to provide good infrastructure. In these countries, populations are scattered rather than densely concentrated. This means that good quality infrastructure, such as a road network system, is lacking. This is a real opportunity for India and Japan to collaborate.

One gets the impression that Japan has been more successful in using official aid in India than other countries like the United States. What explains the success of your country?

There are several reasons. Few countries in North America and Europe have concessional lending facilities. Germany and France have some of these facilities, but not as large a program as ours. Japan has used infrastructure loans in our own history and understands the need for this type of concessional financing among developing countries. Since there is such a long history of cooperation between our two countries, there is also a lot of trust. We are also getting used to working with our counterparts in Indian government agencies. We work together from the planning phase of the project through to eventual implementation.

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