Japan has sanctioned an Indian tech firm for its alleged support to Russia’s “war efforts”, a development that could cast a shadow over an otherwise burgeoning strategic partnership between the two countries.
The sanctions, announced by Japan’s foreign affairs ministry against Bengaluru-based Si2 Microsystems Pvt Ltd, along with other firms based in China, the UAE and Central Asia, mark the first time that Japan has targeted foreign companies over their alleged links to the war in Ukraine.
Japan’s move has “not pleased India and matters are being scrutinised here at a high level”, said people familiar with the matter.
Si2 Microsystems is a system-in-package and microsystems solutions company providing wireless, wireline and microsystems solutions to global customers.
It has design centres and manufacturing operations in Bengaluru, San Jose (California), the Netherlands and Thailand.
Further, it provides leading edge microelectronics solutions by integrating chip and system design capabilities with manufacturing technology to deliver system-in-package and microsystems solutions.
The company had also worked on a central government project, including for a space project.
Also, it had worked with central government agencies to develop chips that can be used in quantum computing, telecommunications and radar and avionics industries, among other applications, according to people in the know.
Experts said the Fumio Kishida-led government, unlike the previous Japanese government, appears to be yielding under the Western pressure to sanction entities associated with Russia without considering the consequences.
ET had first reported that Japan was planning to sanction an Indian entity for its business ties in Russia. Under PM Kishida, Japan has adopted a tougher stance against Russia than any other government in Asia, and the move comes right after the G-7 summit.
In 1998 Japan had slapped economic sanctions against India following the Pokhran-2 atomic tests.
At that time, the statement issued by Japan said, “It is extremely regrettable that India conducted two more nuclear tests on May 13, 1998.
Taking this situation very seriously, the Government of Japan has reiterated its strong demand to India that nuclear testing and development of nuclear weapons be stopped.”
Later, at the UN Disarmament Conference held on May 15, 1998, a Japanese official stated, “Words were not sufficient to express the shock of the Japanese government and people over India’s nuclear tests.
It was said that the explosions completed a series of tests, but the damage they caused and their ultimate effects on the goals of international disarmament were immeasurable.”
Subsequently, Japanese financial aid to India for new projects was frozen except for emergency and humanitarian aid, and grant assistance for grassroots projects, Yen-loans to India for new projects were frozen as well.
The Japanese government also turned cautious over loans to India by multinational development banks and international financial institutions. Japan lifted the sanctions in 2001.
