How reincarnation works in the Narutoverse? Like, it's the soul/spirit that reincarnates into a new body or is just the chakra that is passed down to a new person?
Reincarnation and Souls in Naruto
Hey Anon! This is gonna be a bit of a longer one. I have seen many people getting reincarnation in Naruto wrong. Term definitions, mistranslation allegations, and misconceptions about the involvement of souls in the reincarnation process. For some of these (particularly the mistranslation allegation), I had to look up Japanese raws.
Let me explain some vocabulary first.
Reincarnation in Japanese
In Japanese, there are different ways to say "reincarnation". Similarly, in Naruto, we encounter multiple different expressions and uses for "reincarnation" and even a few terms that are a little misleading. The two best translations for "reincarnation" are, however, "Umarekawari" (生まれ変わり) and "Tensei" (転生).
"Umarekawari" seems to refer to both rebirth and reincarnation. Meanwhile, "Tensei" appears to be more specific to reincarnation and the transmigration of souls. My friend who knows Japanese explained that "Tensei" is also commonly used in Buddhist contexts.
Fun fact! "Tensei" is also very commonly used in Isekai titles like "Mushoku Tensei" (Jobless Reincarnation) and "That Time I Got Reincarnated as a Slime" (Tensei Shitara Slime Datta Ken).
Tensei and Umarekawari in Naruto
In Naruto, "Tensei" appears, for example, in the context of "Edo Tensei" (穢土転生). "Rinne Tensei" (輪廻天生) uses a similar spelling, composed of the characters for "Heaven" and "Life", translating to "Heavenly Life", according to the Naruto wiki.
"Shinra Tensei" (神羅天征) and "Chibaku Tensei" (地爆天星) use the same pronunciation for the "tensei" part but not the same spelling. Hence, those terms do not translate to reincarnation. Instead, "Shinra Tensei" translates to "Heavenly subjugation" and "Chibaku Tensei" translates to "Heavenly Star" or "Heavenly Body Bursting".
As previously explained, "Tensei" translates to "Reincarnation". Now add "Sha" (者) and you get "Tenseisha" (転生者) which translates to "Reincarnated Person". "Tenseisha" is what Hagoromo uses to describe Naruto and Sasuke as reincarnates of Ashura and Indra. There are English translations of the manga that instead say "successor" but those are incorrect as you can see here.
Obito uses a similar expression when referring to Nagato, but combines it with "Umarekawari". Interestingly, Obito doesn't refer to Nagato as an actual reincarnation but as the "reincarnation of the Sage of Six Paths' wish for peace" - so it is not an actual reincarnation.
Jiraiya also refers to Nagato as "Umarekawari" when suggesting he might be the rebirth of the Sage of Six Paths.
Reincarnation Lore in Naruto
Since Nagato wasn't actually a reincarnation of any particular person, the only in-the-sense-of-the-word reincarnates we know of are Ashura's and Indra's reincarnates.
In their case, it is an endless cycle initiated by Indra and then always followed by Ashura. We know that the cycle takes its origin with Indra thanks to an elderly Madara, who had to die of old age first, years after Hashirama's own passing, before new reincarnates could be born. And even then, Sasuke (the Indra reincarnate) is born first ahead of Naruto (the Ashura reincarnate), who is born second.
Hagoromo describes the situation as "reincarnation", but that is not all he says. Specifically, he explains that Ashura's chakra is clinging to Naruto and that Naruto can feel his presence. Hagoromo doesn't explicitly state, however, whether that presence belongs to Ashura's soul or chakra.
Hagoromo makes it sound as though Indra's and Ashura's chakra are merely tagging along with Sasuke and Naruto, rather than being the same person. That makes the chakras of reincarnates still distinct from one another. It might be a similar situation as with Jinchuriki, basically, in which one soul uses another body as a host.
A reincarnate may retain access to Ashura's or Indra's chakra even in and after death, as seen in the case of Madara. This is what allows Hagoromo to return to the mortal world during the war arc. It is unknown, however, whether this chakra (Indra's) is naturally part of Madara's own reserves or whether it is exclusively stored in Madara's Rinnegan and his borrowed Hashirama Cells.
Regardless of which, a person will lose their status as "reincarnate" upon death. This means that chakra alone doesn't make a reincarnate, implying the existence of yet another component, such as the quantity of chakra or the existence of a soul.
And in spite of seemingly popular belief, Indra's and Ashura's souls (魂 "Tamashi") do indeed reincarnate alongside their chakra. This is confirmed in the fourth databook. This makes sense considering the use of the term "Tensei" - because why would you refer to a transmigration of souls specifically if no souls are involved?
Ashura's and Indra's reincarnation cycles bring up an interesting question: What is the connection between chakra and souls in Naruto? While the manga doesn't make any explicit statements, we are shown time and time again just how closely related and deeply intertwined these two concepts are.
Chakra, in general, is not just an energy source. It often transports core aspects of a person. We are being told in multiple instances that chakra contains, is mixed, or clings to a person's will, consciousness, or memories. The most notable example is probably the Shadow Clone Jutsu.
Same thing with Minato and Kushina. While, supposedly, Minato only sealed his and his wife's chakra within Naruto, the chakra in question appears to possess a certain consciousness. Alternatively, it may be capable of summoning Minato's and Kushina's souls for a short amount of time (similarly to how Hagoromo's soul gains access to the mortal world if there is chakra for his soul to cling to). Either way, the manifestations of his parents that Naruto meets inside his mind have personalities, thoughts, feelings, and memories.
This chakra is not able to self-sustain, however, possibly due to chakra's nature of being the product of physical and mental/spiritual energy that requires a physical body (please refer back to chapter #17). Although, it could also be argued that, if a physical, working body is not available, a soul might suffice as well (as is likely the case with Kurama).
While it could just be a coincidence, the appearances of Obito's soul in Kakashi's mind and Kushina's chakra in Naruto's mind follow a similar pattern. Both Obito and Kushina appear in a white void, share their special abilities with a loved one for a short amount of time, and then dissolve into something flame-like before fading away.
A potential connection between soul and chakra becomes even more likely when looking at two Jutsus: The Edo Tensei and the Shiki Fujin.
The goal of the Edo Tensei, as Kabuto describes it, is to bring back a target's soul from the Purelands (ninja heaven, basically). This requires a piece of the person's DNA and, in the end, their body's specific chakra is fully restored or replicated. Hence Madara is capable of recognizing Hashirama's chakra on the battlefield. Looking at Hagoromo's appearance during the war (see the screenshot from chapter 686), chakra seems to be a necessary component for a soul to return to the world of the living.
In the case of Shiki Fujin, the jutsu is supposed to seal a target's soul. But it is not debatable that the jutsu seals the target's chakra in equal measure, as seen in the case of Kurama.
Compiling all of this information together, and assuming that souls and chakra are not synonymous, it appears as though souls in the world of Naruto cannot exist without chakra. Perhaps even vice versa. The presence of chakra within the mortal realm immediately allows for if not causes the retrieval of a person's soul from the Purelands, as is the case with Hagoromo and likely Minato and Kushina as well.
It only makes sense that reincarnates, who inherit the majority if not all of Indra's and Ashura's chakra would become hosts to their souls as well.
Difference to Real World Reincarnation
Quite obviously, reincarnation in Naruto doesn't operate like it does in real-world religious beliefs. While in Buddhist/Hindu traditions, a reincarnate is the reborn person themselves, in Naruto, the reincarnate is more of a host to a soul.
But does that mean that the definition of "reincarnation" no longer applies to Naruto's and Sasuke's connection to Indra and Ashura? The answer is no.
Fiction does not always follow the standard definitions laid out by religion or mythology. It always takes its liberties. Take chakra for example, which, in Hindu beliefs, describes energy centers inside the human body. In Naruto, chakra is a mana-like resource that reflects a character's stamina. It is so unsimilar, the 8 gates are actually a much better parallel to real-world chakra.
Kishimoto often bends religion and mythology to suit his story's needs and make them his own. Had Kishimoto made a different choice, Madara's and Hashirama's revival during the war would have either been impossible or made no sense.