India proposed Japanese pension funds invest in rail projects in the South Asian nation as the government prepares to spend more than $140 billion over five years upgrading its outdated tracks.

Indian Railways Minister Suresh Prabhu said he proposed the investment by Japan’s pension funds during a series of meetings with Prime Minister Shinzo Abe and other ministers recently. The two sides also discussed doing joint research and development on railways, Prabhu said at a speech during a conference on India-Japan economic relations in New Delhi Tuesday, without giving more specific details.

“Any pension funds will first desire security because capital is very important,” Prabhu said. “Railways has a great advantage because they are very safe to invest, because railways are owned by the government of India, so therefore capital is not only guaranteed, but interest on that is also very grand.”

Prabhu didn’t identify any fund by name. Japan’s Government Pension Investment Fund won’t comment on individual discussions, Shinichirou Mori, a Tokyo-based spokesman for the pension fund, the world’s largest, said by telephone Tuesday. The fund is currently invested in completed infrastructure projects that are delivering returns, he said.

David Fuller's view

I credit Suresh Prabhu with trying.  Whether or not Japan’s pension funds invest in India, the growing relationship between these two countries is mutually beneficial. 

Japan is a high-tech leader second only to the USA.  It also has a population problem.  India is the world’s fastest growing larger economy and it has a huge labour force.  Both countries are established democracies and as allies they are stronger relative to China.