Kolkata, Aug 10 (IANS): Japan will be ready to invest and build a business relationship with Jammu and Kashmir if the situation in the valley normalises, Japanese Ambassador to India Kenji Hiramatsu said here on Saturday.

When asked whether Japan is considering the northern state as a potential investment hub following the scrapping of Article 370 of the Indian Constitution which took away the special status of Jammu and Kashmir and now allows companies from other states and abroad to invest there, Hiramatsu said his country looks forward to "positive development" in the region.

"Yes, of course. We look forward to it. I hope the situation there normalises. This is a decision taken by the Indian government. We will have to see. At this stage we cannot say anything for certain. Japan shares a good business relationship with India and of course, there is a possibility of doing business at any place that is part of India," the Japanese envoy said at an event organised by the Bengal Chamber of Commerce and Industry.

"When the situation normalises, I hope at some point there will be some kind of business collaboration between Japan and Jammu & Kashmir. The decision has been taken just a week ago. We have to see how things pan out. We are looking forward to a positive development in future," he said.

Talking about the growing bilateral trade relationship between India and Japan, Hiramatsu said the number of Japanese companies in India has increased from 1,156 in 2014 to 1,441 in 2019, while the sectors of investment have also grown significantly.

He said a new momentum has been added to economic partnership between the two countries while shared security and defence cooperation is rapidly catching up with the already-robust economic partnership.

According to a Japanese government report, trade from India to Japan in 2018 was 585 billion Yen and trade from Japan to India was 1,236 billion Yen. Direct investment from Japan into India was 377 billion Yen in 2018.

He also said Japan was keen on seeing an increase in people-to-people contact with the eastern region of India and invited investors from West Bengal to Japan.

The envoy noted that Japanese companies operating in India were being given incentives from north Indian states and such incentives from West Bengal could encourage more companies here.