Potential for Technical Cooperation Between Japan and China in a Third-Country Market

In order to realize a low-carbon society over a wide area, it is crucial to transfer appropriate existing technologies internationally as a technological strategy in addition to developing innovative technologies. As analyzed in Chap. 1, Japan already has the world’s highest level of energy-saving and high-efficiency technology, and it is costly to reduce CO2 further domestically. In Japan, it is impossible to realize a dramatic reduction of CO2 emission now. In other words, it has a market that contributes to the realization of a broader regional low-carbon society by transferring Japan’s advanced low-carbon technology overseas. Bilateral cooperation still has excellent potential like Japan and China, but the potential for Japan and China to cooperate in low-carbon projects in third-country markets other than Japan and China remains excellent potential. In this study, we conducted a quantitative analysis to clarify the potential of four countries (Japan, China, India, Russia) via third-country market cooperation in the field of energy and environment under the Belt and Road Initiative proposed by China as a regional economic zone concept. Due to the potential for energy and environment reduction, we take India as a case study to find out the measures of technical cooperation between Japan and China on a third market. When Japan, China, and India cooperated to build a 660 MW supercritical coal-fired power plant in India, the economic profit of Japanese and Chinese companies is 237 million dollars per unit in total. Also, Japanese and Chinese companies will receive a total of 215 million dollars in environmental benefits annually. India has a total annual economic benefit of 633 million dollars and the environmental benefit of 13.391 million dollars. It was shown from the cooperation case with India in this study that the cooperation between Japan and China in the third-country market in the field of energy and environment has excellent potential in constructing a regional low-carbon society across borders. Therefore, we propose a “market principle + sharing of economic and environmental benefits + risk-sharing” method as a trilateral market cooperation method. The characteristics of this method are also consistent with the community spirit of sharing benefits and risks.