I'm not sure what that harp-like sound is in the actual music recording, but you're thinking along the right lines in wondering if it could be an ethnic instrument. Its function in the score, I think, is to hint at the multiracial nature of the future depicted in the film.
It's also likely that if the instrument is not actually a Japanese biwa, that it was probably inspired by one. Someone on the production staff (film editor Terry Rawlings maybe?) pulled track 3 ("Ogi No Mato") from Ensemble Nipponia's 1976 album, Explorer Series: Traditional Vocal & Instrumental Pieces [Elektra Nonesuch 9 72072-2] to use as source music in the film and that likely was known to Vangelis, so he may have been trying to hint at that sound in his own music.
You can hear the source cue used as the spinner (flying car) passes the giant billboard/advertisement:
The source cue ends just before the biwa enters in the original track from the album. The segment used starts at about 0:51 of the source track from the album:
I know this isn't a definitive answer, though. Paul Sammon's book, Future Noir: The Making of Blade Runner, may have something more definitive, but my copy is boxed up in storage somewhere and hence not handy at the moment.