Visiting Indian Finance Secretary Duvvuri Subbarao called on Japanese firms Friday to boost investment in India, especially in the field of infrastructure, where the nation plans to spend $500 billion in the next five years.
India expects foreign direct investment to shoulder about a third of the $500 billion project to build much-needed roads, ports and housing.
Speaking before company executives and analysts in Tokyo, Subbarao said India has limited money to spend on infrastructure because of its other priorities of education, social welfare and food security.
"India offers very attractive investment opportunities in infrastructure," Subbarao said. "As much as there has been collaboration on the official side (with Japan), collaboration on the private sector has not been commensurable."
Subbarao admitted that India's investment environment has not been favorable to investors but said the government is working on it.
This includes allocating some $4 billion to train unskilled workers, especially those in agriculture, so they can make the transition to the industrial sector.
As India continues to promote more of this economic shift in the coming decades, there will be about 100 million farmers in need of manufacturing jobs, Subbarao said.
Toyota Motor Corp. executive Yasuhiko Yokoi, who attended the forum, said the automaker's criteria for building a plant on foreign soil is political stability, consistency in policies, sufficient infrastructure and rising demand.
In April, Toyota announced a plan to build a second manufacturing plant in India that would go online in 2010.