Japan Needs Indian Tech Workers. But Do They Need Japan?

Recruiters call the push a crucial test of whether the world’s third-largest economy can compete with the U.S. and Europe for global talent.

In many ways, Yogendra Puranik is an immigrant success story.

Mr. Puranik, 45, joined the initial wave of Indian tech workers who went to Japan in the early 2000s. He became a Japanese citizen and in 2019 won elected office in Tokyo, a first for anyone from India. This year, he was hired as the principal of a public school.

Now, though, as Japanese companies scramble to lure more highly educated Indians like Mr. Puranik to fill a yawning shortage of IT engineers, he is under no illusion about the challenges that Japan, and those it attracts, will face.

Recruiters call it a crucial test of Japan’s ability to compete with the United States and Europe for increasingly sought-after global talent. But lower pay and steep language and cultural barriers make Japan less attractive for many. Rigid corporate structures can frustrate newcomers. And Japan, which has long been ambivalent about the presence of foreigners, lacks an established system to integrate them into Japanese life.

“These foreigners are coming, and there is no communication between the Japanese and foreigners,” Mr. Puranik said at his home in an Indian neighborhood in eastern Tokyo. “There is no inclusivity happening.”

As it rapidly ages, Japan desperately needs more workers to fuel the world’s third-largest economy and plug gaps in everything from farming and factory work to elder care and nursing. Bending to this reality, the country has eased strict limits on immigration in hopes of attracting hundreds of thousands of foreign workers, most notably through a landmark expansion of work visa rules approved in 2018.

The need for international talent is perhaps no greater than in the tech sector, where the government estimates that the shortfall in workers will reach nearly 800,000 in the coming years as the country pursues a long-overdue national digitization effort.

The pandemic, by pushing work, education and many other aspects of daily life onto online platforms, has magnified the technological shortcomings of a country once seen as a leader in high tech.

Japanese companies, particularly smaller ones, have struggled to wean themselves from physical paperwork and adopt digital tools. Government reports and independent analyses show Japanese companies’ use of cloud technologies is nearly a decade behind those in the United States.

India produces a vast pool of 1.5 million engineering graduates each year who could help Japan play digital catch-up. When Indian workers do answer the call, many speak admiringly of the cleanliness and safety of Japanese cities, and say their salaries allow them to live comfortably, if not lavishly. Those who have studied Japanese language and culture can be effusive in their praise.

“As it happens to anyone who comes to Japan, you fall in love,” said Shailesh Date, 50, who first went to the country in 1996 and is now the head of technology for the American financial services company Franklin Templeton Japan in Tokyo. “It’s the most beautiful country to live in.”

Yet the Indian newcomers mostly admire Japan from across a divide. Many of Japan’s 36,000 Indians are concentrated in the Edogawa section of eastern Tokyo, where they have their own vegetarian restaurants, places of worship and specialty grocery stores. The area has two major Indian schools where children study in English and follow Indian curricular standards.

Nirmal Jain, an Indian educator, said she founded the Indian International School in Japan in 2004 for children who would not thrive in Japan’s one-size-fits-all public education system. The school now has 1,400 students on two campuses and is building a new, larger facility in Tokyo.

Ms. Jain said that separate schools were appropriate in a place like Japan, where people tend to keep their distance from outsiders.

“I mean, they are nice people, everything is perfect, but when it comes to person-to-person relationships, it’s kind of not there,” she said.

Mr. Puranik said fellow Indians often called him for help with emergencies or conflicts — the wandering father with dementia who ends up in police custody, the daughter mistakenly stopped by border agents at the airport. He once even fielded a call from a worker who wanted to sue his Japanese boss for kicking him.

His own son, he said, was bullied in a Japanese school — by the teacher. Mr. Puranik said he repeatedly talked to the teacher, to no avail. “She would always try to make him a criminal,” he said, adding that some teachers “feel challenged if the kid is doing anything differently.”

A similar dynamic can sometimes be found in the workplace.

Many Indian tech workers in Japan say they encounter ironclad corporate hierarchies and resistance to change, a paradox in an industry that thrives on innovation and risk-taking.

“They want things in a particular order; they want case studies and past experience,” Mr. Puranik said of some Japanese managers. “IT doesn’t work like that. There is no past experience. We have to reinvent ourselves every day.”

The majority of Indian IT workers arrive in Japan without much knowledge of the language or culture, said Megha Wadhwa, a migration researcher and Japanese and South Asian studies expert at the Free University of Berlin and author of the 2021 book “Indian Migrants in Tokyo.” That can hinder their careers while their peers are making strides back home or in the United States or Europe. They soon start to explore their options and often end up moving elsewhere. In the United States, average tech salaries, by some estimates, are more than twice those in Japan.

“After the pink glasses are removed, they will know the real situation, and they will feel stagnant in Japan,” said Dr. Wadhwa, who lived and worked in Japan for some 15 years.

Still, Japanese companies have made decisive moves in recent years to tap into the pool of Indian engineering graduates, either by bringing them to Japan or employing them in India.

Japanese companies like Rakuten and Mercari, both e-commerce firms, have set up operations in India. The Japanese government has funneled aid into India to support the expansion of technology education.

Kotaro Kataoka, a professor at the Indian Institute of Technology Hyderabad, acts as a matchmaker between Indian students and tech companies. He said Japanese recruiters had gotten off to a slow start in India by focusing instead on East Asian countries like Vietnam and China that are considered more culturally similar to Japan.

But Indian recruits, he said, offer the independent, out-of-the-box thinking that Japanese companies need to kick-start their innovation efforts. “They do whatever they want, but sometimes that randomness and out-of-control aspect of Indian talent nicely works,” Professor Kataoka said.

Many Japanese argue that it’s a tall order for a country with historically low levels of immigration to match the flexibility and diversity of countries in North America or Western Europe.

Big-name American tech companies have recruited aggressively in India, offering immigrant-friendly work environments, surging compensation packages and sky’s-the-limit career advancement opportunities. Google, Twitter, Microsoft and Adobe have all had Indian-born chief executives.

Still, there are efforts to bridge the gaps in Edogawa. Mr. Puranik runs an Indian cultural center in his home where Japanese students take yoga lessons, and Indian and Japanese students gather for percussion lessons on the Indian tabla from a Japanese teacher. Mr. Puranik often hosts Japanese college students for talks on Indian culture or immigration.

Japanese officials also provide venues and assistance for Indian cultural festivals attended by the wider community. Mr. Puranik said that such symbolic gestures were nice, but that it was more important to provide expanded Japanese language training and cultural instruction.

“There has to be more interaction,” he said. “Summer festival and Diwali festival, yes, one-off in a year you can have that, that’s a bonus. But you cannot say that bonus is your salary.”

At the same time, many Indians in Edogawa say that newcomers could do more to fit into Japanese life.

Mr. Date, the technology head at Franklin Templeton, said he and a few friends wanted to counter the growing reputation of Indians as being noisy — a pet peeve in a crowded city of thin-walled apartments — and a widespread belief that they are reluctant to conform to Japanese ways.

So their running group, the Desi Runners of Tokyo, decided to have members donate 10 yen for every kilometer they run. Last year, they donated 400,000 yen, about $3,000, to a charity in Edogawa, he said.

“We all agreed: We are living here, we are earning money,” Mr. Date said. “Maybe it’s time to give back to Japan.”

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