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2026.03.24
The business cultures of India and Japan may look similar at first glance, but in fact there are major differences. Both countries are major Asian economies with a culture that values hierarchy within organizations and respect for etiquette, but fundamental differences exist in decision-making processes, communication styles, and the sense of time. In 2025, India overtook Japan to become the world's 4th largest economy by GDP, and business exchange between the two countries has never been more active. This article explains seven crucial differences that Japanese companies should know when doing business in India.
Decision-making at Japanese companies is characterized by a bottom-up consensus-building process, typified by nemawashi and the ringi approval system. This "consensus method," in which everyone involved is consulted and overall agreement is reached before a decision is made, produces high-quality decisions but has the drawback of taking time. At Japanese companies where the PDCA (Plan-Do-Check-Act) cycle is deeply rooted, the most time tends to be spent on the planning stage.
At Indian companies, decision-making is often left in the hands of top management or a limited group of senior executives. Junior employees are rarely deeply involved in decisions, and decisions are correspondingly fast. Indian businesspeople excel at improvised problem-solving known as "jugaad," and tend to value speedy execution over a perfect plan.
The careful Japanese style of decision-making can be seen as "too slow" in India's competitive environment. It is important to delegate a certain degree of authority to local management to speed up decision-making.
Japanese business communication is based on a high-context culture. Reading the situation and "reading the air" are expected, and direct denial or confrontation is avoided. Objections to a superior are phrased euphemistically, and it is not unusual for "we will consider it" to effectively mean "no."
Because India is a multilingual, multicultural society, clear and direct communication is required. Business meetings involve lively debate, and stating a differing opinion confidently is valued as "assertiveness." There is also a habit of asking many questions to clearly confirm the other party's intent.
The ambiguity of the Japanese communication style tends to leave Indian staff confused about what is expected of them. Clearly articulating instructions and expectations, and giving concrete feedback, are key to successful management in India.
In Japanese business culture, punctuality is the most basic rule of all. Meetings start on time, and deadlines are strictly kept. In India, on the other hand, the sense of time is flexible enough that "IST" (Indian Standard Time) is jokingly reinterpreted as "Indian Stretchable Time." It is not unusual for a meeting to start 30 minutes late, and project deadlines often slip past the original schedule.
Japanese companies should address this difference in the sense of time by building buffers into important milestones and checking progress regularly. That said, time management is improving at Indian IT companies and startups, and it should be avoided to uniformly assume that "Indians are lax about time."
Both Japan and India are societies with a strong sense of hierarchy, but it manifests differently. In Japan, seniority forms the basis of the hierarchy, yet there is a "middle-up-down" mechanism in which frontline opinions are respected. In India, on the other hand, the hierarchy is more clearly defined, and a superior's instructions carry absolute authority. This is also rooted in a culture of respecting elders within the family structure.
When Japanese companies run an organization in India, it is important to give local managers clear authority and responsibility. If authority is ambiguous, Indian staff will hesitate to make judgment calls and end up escalating everything to Japanese headquarters.
In Japan, the tradition of lifetime employment is fading, but long tenure at a single company is still generally seen as a virtue. In India, by contrast, job changes are common, and an annual turnover rate of 15-20% is simply the norm, especially in IT. There is a culture of switching jobs without hesitation when better pay or career advancement opportunities arise.
Japanese companies should understand the fluidity of India's talent market and work to retain employees through competitive pay structures, clear career paths, and robust training programs. It is also essential to build a knowledge-management system so that important know-how does not depend on any single individual.
In Japanese negotiations, it is common to take time building a relationship of trust and to approach agreement step by step. Often the broad outline has already been decided through prior nemawashi, and the negotiation itself functions more as a "place to confirm" than to decide.
In India, negotiation carries a strong element of "give and take," and it is common for a large discount or change in terms to be requested from the initial proposal. The ability to respond flexibly with a "jugaad" spirit and find a win-win outcome is valued. Silence can be interpreted as "not interested" rather than "under consideration," so active communication is required.
Japan has a strongly risk-averse culture, with an organizational climate that finds it hard to tolerate failure. In pursuing perfection, there is a tendency for decisions to be delayed or for new challenges to be approached with hesitation.
In India, risk-taking is relatively accepted, and a startup mindset of learning from failure is spreading. The idea of "fail fast, learn fast" is especially prominent in the IT and startup sectors. Japanese companies operating in India should tolerate a certain amount of trial and error and adopt an approach of "start small, then improve."
The differences between Indian and Japanese business culture span many areas: the speed of decision-making, clarity of communication, sense of time, fluidity of talent, negotiation style, and risk tolerance. However, these differences are not a "wall" but something that can be turned into a "strength" if understood correctly. By combining Japan's commitment to quality with India's speed and capacity for innovation, companies from both countries can build a powerful partnership that draws on each other's strengths.
Japan is characterized by bottom-up consensus building, typified by nemawashi and the ringi system, which takes time in proportion to its care. India centers on rapid decisions by top management, and decisions tend to be made quickly. The careful Japanese style can be seen as too slow in India.
Japan's high-context, ambiguous style of expression tends to leave Indian staff confused about what is expected of them. India calls for clear, direct communication, and lively debate is valued as assertiveness. Concretely articulating instructions and expectations is key to success.
Since meetings running late and deadlines slipping are common, it is effective to build buffers into important milestones and check progress regularly. That said, time management is improving at IT companies and startups, so it should be avoided to uniformly assume people are lax about time. You need to judge flexibly depending on the counterpart and the industry.
Job changes are common in India, and turnover tends to be high, especially in IT. It is important to retain employees through competitive pay structures, clear career paths, and robust training programs. Building a knowledge-management system so that important know-how does not depend on any single individual is also essential.
Negotiation in India carries a strong element of give and take, and it is common for a large discount or change in terms to be requested from the initial proposal. Since silence can be interpreted as a lack of interest, active communication is required. A flexible attitude of searching for a win-win outcome is effective.
A good starting point is a two-way effort: pre-departure training for expatriates and education about Japanese culture for local staff. Placing bridge personnel who understand both Japanese and Indian culture, and clarifying the scope of authority of the local subsidiary, enable rapid decision-making. Building a system of regular communication that resolves gaps in perception early is effective.
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