Taiwan is eyeing a stronger economic partnership with India, focusing on technology and trade. Hsu Szu-Chien, Taiwan’s Deputy National Security Adviser, recently shared insight on how a free trade agreement could help India reduce its reliance on electronic components from China.
In a conversation during the Raisina Dialogue, a key geopolitical conference in India, Hsu emphasized that a trade deal could lead to more Taiwanese investments in India’s semiconductor and tech sectors. This is particularly important given India’s significant trade deficit with China, where imports reached nearly $101.75 billion in the 2023-24 period, compared to exports of just $16.65 billion.
According to Hsu, Taiwan has a wealth of technology that, combined with India’s young workforce, could be used to manufacture high-end tech components locally. He mentioned that India has the potential to produce a lot of information and communication technology (ICT) products, which traditionally have been imported from China.
The benefits of such a partnership go beyond just trade numbers. Taiwan produces around 70% of the world’s semiconductors and over 90% of the most advanced chips. These chips are essential for everything from smartphones to advanced AI systems. Hsu believes that establishing a trade pact would be beneficial, especially for smaller Taiwanese companies facing high tariffs in India.
The ongoing shifts in global manufacturing—sparked by trade tensions between the U.S. and China and rising military tensions near Taiwan—are prompting many Taiwanese businesses to relocate their production to countries like India. This move aligns with India’s "Make in India" initiative, which has already attracted over $4 billion in Taiwanese investments across various sectors, including machinery and automobile components.
Despite the lack of formal diplomatic ties, trade between India and Taiwan has been growing. Since the establishment of the India-Taipei Association in 1995, interactions have flourished, paving the way for business and cultural exchanges.
As both nations look to the future, the potential for economic cooperation appears bright, driven by mutual interests in technology and investment. With a free trade agreement on the horizon, we may soon see a transformative shift in how India engages with Taiwan and positions itself on the global economic stage.
For more detailed statistics and insights on India’s trade dynamics, you can refer to the Ministry of Commerce and Industry’s reports here.
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