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The hosts edge Malaysia 4-3 in a thrilling final at Chennai.
India will take on Malaysia in the final on Saturday, while Japan will face South Korea in the third-fourth place play-off.
The hosts won 3-2 in their fourth round-robin fixture in Chennai.
India had five scorers on the night, including fan favourite Karthi Selvam.
Harmanpreet equalised in the 43rd minute after Japan took the lead in the 28th minute.
Harmanpreet and Varun scored a brace each in India's tournament opener.
The team will continue to be led by ace drag-flicker and defender Harmanpreet Singh while prolific midfielder Hardik Singh will be his deputy.
India defeated arch-rivals Pakistan 4-3 in a thrilling bronze-medal match.
Pakistan also suffered defeat in the semifinals, losing 5-6 to Korea earlier.
Dilpreet Singh scored a hat-trick as India crushed the neighbours 9-0.