India, Japan sign AI and defence pacts at 16th summit
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- India and Japan signed pacts on AI, metals, energy, and a joint economic security roadmap on July 2 during their 16th annual summit in New Delhi, with Modi and Takaichi leading talks.
- Modi announced the two countries' first joint defence co-development agreement and launched the India-Japan Biogas Initiative to build 1,000 biogas and organic fertiliser plants in India.
- Bilateral trade between the two countries reached US$27.5 billion in fiscal year 2025/26, while Japanese investment in India totaled US$3.2 billion between April and December 2025.
- Modi said the convergence of Japan's precision technology and India's software capabilities will give "new momentum and strength to global AI development."
- Japan backs major Indian infrastructure including the Mumbai-Ahmedabad high-speed rail corridor, and Japanese firms recently struck a US$1.6 billion deal for a 20 per cent stake in Yes Bank.
- Takaichi arrived with a large business delegation and was scheduled to speak at a business conference later on July 2.
Why it matters: The summit marks India's and Japan's first joint defence co-development agreement, elevating a partnership that has run on trade and infrastructure into coordinated military-industrial collaboration. With trade at US$27.5 billion and Japanese investment hitting US$3.2 billion in just nine months, the AI and energy pacts turn the Quad relationship into concrete industrial projects — and signal to China that the two Asian democracies are locking in deeper strategic alignment.
