Japan’s Defence Export Renaissance

In a dramatic shift from decades of postwar restraint, Japan has embarked on a bold mission to transform its defence industry into a globally competitive player.

The recent relaxation of arms export restrictions marks a turning point—not only for Japan's domestic defence sector but also for regional and global partners seeking reliable, high-quality alternatives in an increasingly complex security environment.

ATLA At It

"Based on the Three Principles on Transfer of Defense Equipment and Technology, Japan promotes cooperation in defense equipment and technology with other countries in order to contribute to the maintenance and strengthening of defense production and technological bases, as well as contributing to the promotion of our national security, peace and international cooperation," said a senior official at the Acquisition, Technology & Logistics Agency (ATLA), which has been working on overseas transfer of defense equipment in order to strengthen the cooperation with like-minded partners.

"Japan will continue to realize effective defense equipment and technological cooperation through the strengthening of intelligence gathering such as the needs of its counterparts, cooperation including assistance for maintenance and repair of equipment, and strengthening of cooperative posture between the public and private sectors," the official said.

This evolution is more than a regulatory change—it’s a strategic signal to the international community: Japan is open for defence business.

"We feel defense equipment and technology cooperation with major European countries, which have competitive defense industries, will contribute to the strengthening of security and defense cooperation with these countries," the ATLA official said.

"Also, partner countries in the Asia-Pacific region have expressed their interest and expectation regarding defense equipment and technology cooperation with Japan, and the MOD proactively seeks to build relationships with these countries," he added.

From Pacifism to Pragmatism

For decades, Japan’s pacifist constitution and strict arms export policies severely limited the scope of its defence industry. Until recently, exports of defence equipment were only permitted under highly exceptional circumstances. This limited domestic manufacturers to the Self-Defense Forces (SDF) as their sole customer, resulting in low profitability and market stagnation. More than 100 companies have exited the sector in the past two decades, citing reputational risk and weak returns.

However, changing regional security dynamics have driven Tokyo to reevaluate its defence posture. The 2022 update to Japan’s National Security Strategy (NSS) describes its defence industry and technological capabilities as “defence capabilities themselves,” elevating industrial resilience to a matter of national security. With escalating threats from China, North Korea, and a broader reshuffling of global alliances, Japan now sees defence exports not just as an economic opportunity but as a strategic tool to bolster security partnerships and enhance regional stability.

"Japan has dealt with arms exports in a careful manner, in accordance with the Three Principles of Arms Exports and their related policy guidelines. On the other hand, in individual cases, such as the participation of domestic companies in the joint development of Ballistic Missile Defense (BMD) by Japan and the United States, it has taken separate measures in which arms exports are dealt with outside the Three Principles," a defence ministry official said.

Policy Overhaul

Japan’s cabinet, under former Prime Minister Fumio Kishida, had enacted two key revisions to its defence export framework. The latest changes unlock several important pathways.

Japan can now export fully assembled defence equipment built under foreign licences—like PAC-3 missiles—to the originating country such as the United States.

Equipment with lethal capabilities can be transferred under five approved categories: rescue, transport, warning, surveillance, and minesweeping.

Non-lethal equipment can be exported to states facing illegal aggression, expanding what was previously a Ukraine-only exception.

And, Japan’s upcoming fighter jet, co-developed with the UK and Italy, can now be sold to 15 trusted nations with bilateral equipment transfer agreements.

These changes set the stage for Japan’s defence industry to participate in multinational co-development and export programs on par with leading arms-producing nations.

Equipment on Offer

Japan brings to market a suite of technologically sophisticated systems that offer reliability, precision, and long-term support.

Mogami-Class Frigates

Built by Mitsubishi Heavy Industries, these stealthy, multi-role warships are central to Japan’s pitch to the Royal Australian Navy, competing head-to-head with Germany’s Meko A-200 in a multi-billion-dollar bid.

FPS-3ME Air Defence Radar Systems

Deployed to the Philippines in 2023 to enhance maritime domain awareness, this radar suite demonstrates Japan’s growing footprint in regional security assistance.

Kawasaki P-1 Maritime Patrol Aircraft

Offered to Thailand and Vietnam, the P-1 represents a high-performance alternative to Western platforms.

Unified Complex Radio Antenna (UNICORN)

Exported to India in 2024 for naval applications, marking Japan’s first defence tech transfer to New Delhi and opening the door to further co-development.

Next-Generation Fighter Jet (GCAP)

Under joint development with the UK and Italy, this stealth aircraft could be Japan’s most high-profile export in the coming decade.

Global Targets

Japan’s export strategy targets key Indo-Pacific democracies and like-minded nations with shared security interests. Active discussions are underway with Australia where in Japan has proposed a US$6.6 billion sale of Mogami-class frigates to supplement the Hunter-class fleet.

This is not merely a ship deal; it signals deepening bilateral industrial cooperation, including potential collaboration in Australia’s Guided Weapons and Explosive Ordnance (GWEO) enterprise.

With rising maritime tensions in the South China Sea, Tokyo and Manila have expanded defence cooperation. Japan’s air defence radar at Wallace Air Station and a reciprocal access agreement signed in 2022 mark the beginning of deeper technology sharing and equipment transfers.

The export of UNICORN to India and the plan for further co-development highlight Japan’s commitment to Indo-Pacific resilience and to diversifying New Delhi’s sourcing beyond Russian hardware.

Ongoing discussions involve the potential transfer of Mogami-class frigates and maritime patrol aircraft to bolster coastal defence and surveillance capabilities to Indonesia and Vietnam.

Strategic Benefits for Buyers and Industry Players

For international customers, Japan offers a compelling value proposition.

"Our systems are backed by cutting-edge engineering, rigorous quality standards, and the promise of long-term interoperability with U.S. and allied platforms. Buyers also gain access to sustainable partnerships rather than transactional purchases—covering training, maintenance, and even joint development opportunities," according to the ATLA official.

For global defence manufacturers, Japan’s shift opens the door to co-production, licensing, and supply chain integration. Firms seeking stable, high-tech partners in a diversifying global market will find strong allies in Japanese industry giants like Mitsubishi Electric, Kawasaki Heavy Industries, and IHI Corporation.

The government’s new national defence industrial strategy—expected this year (2025) will further clarify incentives, investment avenues, and technology focus areas, with updates planned every five years.

Obstacles and Opportunities

Despite this progress, hurdles remain. Japanese public sentiment toward arms exports is cautious; nearly half of citizens oppose the policy shift, and pacifist leanings continue to influence coalition politics. Defence firms still derive only 10 per cent of revenue from military contracts, limiting their incentive to scale quickly.

Additionally, geopolitical critics—particularly China and North Korea—accuse Japan of undermining regional stability and reigniting militarism. However, Japan maintains that all exports will adhere to strict regulations, exclude conflict zones, and align with the UN Charter’s principles of peaceful dispute resolution.

Looking Ahead

As Japan unveils its updated export strategy at international defence shows, it is not just marketing equipment—it is signaling a strategic realignment. Tokyo seeks to build durable security networks across the Indo-Pacific and beyond, grounded in transparency, shared values, and industrial cooperation.

For prospective buyers, Japan’s offerings now represent more than hardware—they are gateways to regional security architectures and long-term capability-building. For manufacturers, Japan is an emerging partner of trust and ambition in a world seeking resilience and reliability.

"At the same time, in promoting defense equipment and technology cooperation internationally, the MOD will work to strengthen intellectual property management, technology control, and information security in order to prevent leakage of advantageous technologies for defense equipment," the MoD official noted.

Japan’s message is clear: it’s ready to contribute more forcefully to global security—through partnerships, production, and peace-preserving technology.