Taiwan looks to India as an important destination for trade and investment
Addressing the Indian media in Taipei, James Huang, Chairman of the Taiwan External Trade Development Council (TAITRA), shares how Taiwan plans to partner with PM Narendra Modi’s initiatives such as Digital India, Make in India, and smart cities.
Over the last couple of years, the Taiwan External Trade Development Council (TAITRA) has been focusing on strengthening trade ties with India. Headed by former Taiwan foreign minister James Huang, TAITRA is the official body of the Taiwan government for trade promotion. James highlighted that the country had mostly focused on bilateral ties with Southeast Asian countries, but with its new southbound policy, the focus is on India.
Launched in September 2016 by President Tsai Ing-Wen, the new southbound policy is aimed at enhancing the island’s relations with other countries, including the members of the Association of Southeast Asian Nations (ASEAN); six nations in South Asia (India, Pakistan, Bangladesh, Nepal, Sri Lanka, Bhutan); Australia; and New Zealand.
Huang, who was earlier the director of Taiwan's new southbound policy, said: “In May 2015, the current president made a keynote address, where she emphasised on pushing for a new southbound policy. The previous southbound policy focused only on Southeast Asian countries. The new policy aims to focus on strengthening trade, investment, and cultural engagements with countries, particularly the Indian subcontinent.”
Bilateral trade between India and Taiwan, earlier estimated at $5 billion, increased to $6.3 billion in December 2017. Currently, smart solutions, hardware, software, and electronics are some of the key offerings among others driving bilateral trade and investment.
However, Huang said petrochemicals and food processing are areas that can enhance cross-border business.
Contribution to government initiatives
Last year, an India centre was launched in Taipei to promote awareness about India’s business ecosystem in Taiwan. Taiwan is also eyeing partnering Prime Minister Narendra Modi’s initiatives, be it Digital India, Make in India, or smart cities mission. In November 2017, TAITRA organised a “smart city” in Bengaluru, showcasing effective solutions for smart cities.
“PM Narendra Modi’s initiatives such as Make in India, Digital India, and Skill India are ones in which Taiwan can be a good partner. Our investments in China and Southeast Asia in the past three decades have helped tremendously. I believe this is the right moment for Taiwan to engage with India for the next 20 years,” James added.
In terms of the Make in India initiative, Taiwan is planning to develop industrial parks and is set to launch a petrochemical park in India. The island is also looking to enhance electronic manufacturing capability in India.
Huang also said Taiwan’s electric vehicle industry can help India in its initiative to get petrol and diesel vehicles off the roads and switch to electric vehicles.
“We invited electrical vehicle partners from India to come over to Taiwan for seminars and explore opportunities to work with our EV industry because as per the Indian government’s plans, the country will stop using diesel and petrol vehicles by 2030. EV will naturally be a very important industry in India in the future,” Huang highlighted.
The challenges
A major issue deemed to be hindering Taiwan’s economic relations with other countries is China’s territorial dominance over the island, including the One-China policy that opposes the existence of Taiwan (Republic of China) as a separate country and claims Mainland China (People’s Republic of China) is the only real China. Therefore, no country is allowed to maintain formal diplomatic ties with Taiwan (ROC).
In the past, India has been warned by Beijing to adhere to the One-China policy.
India too has no formal diplomatic relations with Taiwan. In the absence of official diplomatic relations, the India-Taipei Association is deemed as India's de-facto embassy in the island, and the Taipei Economic Cultural Centre, New Delhi is Taiwan’s representative office in India.
However, Huang said that the process to engage with India has nothing to do with geopolitics in the region and the island's partnership with India is solely focused on trade, investment, and cultural exchange.
He also revealed that "India had shown interest in entering a free-trade agreement (FTA) with Taiwan some years ago; the country is still keen to explore an FTA between the two countries, aimed at seeking closer trade ties."
Plans to penetrate India’s business ecosystem
With an aim to strengthen trade ties with India, TAITRA already has three offices in India – Mumbai, Chennai, and Kolkata. The island’s leading trade promotion organisation is launching its fourth office in Delhi today. Currently, TAITRA also has five offices in the US.
After the launch of TAITRA's office in Delhi, next up is the first Taiwan expo in New Delhi on May 17. James highlighted that the expo will showcase the latest cutting-edge technology and smart solutions of Taiwan.
“The Taiwan expo will be a major event to bring to notice of the Indian business community that here we are and that we want to be a part of the business ecosystem for the next 20-30 years,” he said.