Less than a year after Prime Minister Modi’s visit to Tokyo to meet then Prime Minister Ishiba, the strategic environment has shifted dramatically.

The conflict in West Asia has exposed vulnerabilities in global energy supply chains and maritime trade routes.

Renewed trade tensions have accelerated the search for trusted industrial partners, while rising electricity demand driven by artificial intelligence and advanced manufacturing has broadened the definition of energy security.

Japanese Prime Minister Takaichi’s visit to New Delhi for the 16th Annual Summit highlighted the need to reassess the India–Japan energy partnership in this evolving geopolitical landscape.

The summit language reflected this shift, with both leaders recognising their shared status as major energy-importing economies exposed to volatility in global markets. They underscored the need to deepen cooperation on energy security and welcomed the adoption of a Joint Statement on Energy Resilience.

The statement emphasised advancing the clean energy transition while strengthening cooperation on strategic petroleum reserves. Both sides agreed to exchange best practices, collaborate on strategic stockpiling ecosystems, and support stronger coordination among major energy-consuming countries.

It also identified cooperation with producing nations, emergency response, market stabilisation, and joint opportunities across the maritime energy-transport value chain.

These discussions are expected to progress under the India–Japan Joint Working Group on Petroleum and Natural Gas, operating within the India–Japan Energy Dialogue. Whether this evolves into strategic stockpiling arrangements similar to India’s partnerships with producers such as the UAE remains uncertain.

Japan, as one of the world’s largest LNG importers, brings decades of expertise in procurement, shipping, storage, and regasification. India, revisiting questions of gas security and long-term LNG resilience, sees scope for cooperation extending beyond supplies to logistics, carrier technology, infrastructure planning, and market development.

With tensions around the Strait of Hormuz creating uncertainty, both nations are grappling with the consequences of supply disruption. For import-dependent Asian economies, energy security now encompasses diversified fuel sources, strategic reserves, resilient electricity networks, and robust industrial supply chains.

Nearly two decades after the India–Japan Energy Dialogue was established in 2006, cooperation has expanded through the Clean Energy Partnership, sectoral working groups, the Joint Crediting Mechanism, and the Joint Vision for the Next Decade announced during Modi’s 2025 Tokyo visit. Initially conceived to advance the energy transition, these institutions must now also strengthen resilience, competitiveness, and supply-chain security.

Japan’s newly proposed Partnership on Wide Energy and Resources Resilience (POWERR Asia) is a clear manifestation of this shift. Conceived in response to regional energy disruptions, it is evolving into a broader platform for regional energy diplomacy, with India as its first major recipient.

As part of its inaugural project, JBIC, Sumitomo Mitsui Banking Corporation, and other Japanese lenders will provide up to ¥80 billion ($492 million) in syndicated financing for Power Grid Corporation of India’s high-voltage direct current transmission project linking Khavda in Gujarat with Nagpur in Maharashtra. This builds on Hitachi Energy’s earlier contracts and strengthens India’s ability to integrate renewable electricity while improving grid resilience.

Japan will also provide insurance through Nippon Export and Investment Insurance (NEXI) for $600 million equivalent, covering loans from MUFG Bank and others to support Reliance Industries’ battery and solar manufacturing ambitions.

This financing will bolster procurement, manufacturing, and research, while strengthening supply-chain cooperation and reducing dependence on concentrated manufacturing bases.

Clean fuels are another area of evolution. In 2024, ACME Group signed an offtake agreement with Japan’s IHI Corporation to supply 0.4 million metric tons of green ammonia annually from its Odisha facility.

By 2026, the joint venture was certified under Japan’s price-gap support scheme, with 228,000 tons of annual production eligible for support over 25 years starting September 2030, and another 177,000 tons earmarked under Japan’s Long-Term Decarbonised Power Source Auction.

Japanese off-takers now include Hokkaido Electric Power, Sumitomo Chemical, Mitsubishi Gas Chemical, and UBE. Total investment is expected to reach about ¥480 billion ($3 billion). Mitsubishi Gas Chemical has also signed a 10-year agreement with ACME to procure 100 ktpa of green methanol from ACME’s Paradip facility in Odisha. This positions India as a future supplier within Japan’s clean energy ecosystem.

The summit also introduced a decentralised dimension through the India–Japan Biogas Initiative, which will establish 1,000 biogas and organic-fertiliser plants across India. This links clean energy with rural livelihoods and resource recovery, showing that resilience need not be confined to large-scale infrastructure.

Nuclear energy received less attention at the summit. Yet Japan’s strengths extend beyond reactor technology to regulation, operational safety, emergency preparedness, and fuel-cycle governance. With India pursuing reforms to enable greater private participation in the nuclear sector, cooperation on safety standards, workforce training, and regulatory best practices could become a vital pillar of long-term energy security.

India offers scale, manufacturing potential, and one of the fastest-growing energy markets. Japan offers patient capital, advanced technologies, engineering expertise, and institutional experience. Together, they are well positioned to build resilient industrial ecosystems rather than merely finance individual projects.

This evolution comes at a significant moment. As Japan marks a decade of its Free and Open Indo-Pacific vision and India and Japan approach the 75th anniversary of diplomatic relations, both nations are seeking to strengthen their positions in an uncertain geopolitical landscape.

Energy is becoming a defining intersection of economic growth, climate ambition, industrial competitiveness, and regional stability.

From strategic reserves and resilient grids to clean fuels, India and Japan have the opportunity to demonstrate how two major Asian energy-importing economies can jointly shape a secure, sustainable, and resilient energy future.

Agencies