If UK builds an IC at India and five infantry on UK1, Japan should not take on J1 if USSR has a realistic chance to retake, precisely because of the heavy cost in fighters of attacking a fortified India, and the subsequent fortification. (Note: If building an IC in India, depending on the German build, a UK fighter instead of 5 infantry is often worthwhile). But the THREAT of Japan taking on J1 is enough to divert Allied forces; a continual Japan threat to India diverts Allied forces while Germany grows stronger. It is very hard to make progress against a J1 three transport two infantry build, followed by transport/fighter/infantry builds, so the Allies stall out.
To further explain:
If Germany has a strong Baltic fleet and moved the Mediterranean fleet west, the Allies won’t be going anywhere in Europe or Africa anytime soon, and invasion of London is threatened. So the Allies can unite their fleet southwest of London, and UK London forces of 2 inf 1 art 2 tank 1 fighter (1 tank from W. Canada and 1 fighter) are joined by US forces of 2 inf 1 art 1 tank 1 fighter 1 bomber for total 1 bomber, 6 infantry equivalents on defense, 3 tanks, 2 fighter, 1 AA gun, which is not an entirely robust defense, but sufficient to withstand a decently sized German threat.
This frees the UK airforce to move east, to join the Indian forces. The UK fighter build also allows the UK to lend additional early support to India.
Of course, if the Germans went heavy on transports, the Allies should respond with 5 inf 3 tank, US sacrificial transports to London (the US transports are easily targetable by the Germans if the Med fleet moved west, or from air from W. Eur), and fighters from Moscow. In which case the Allies should definitely go KGF; with so much of Germany’s income tied up in transports, Russia will be very strong and Germany very weak.
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If you wait until UK3 to build an IC, then Japan will certainly smash the IC. J1 fighters go to Pearl and are out of position, J2 fighters return to Asia, J3 they are in position to hit India. This combines with J2 transports from Japan to French Indochina, also standard in my games.