%20(1).png)
Leading Taiwanese technology businesses are considering shifting their production bases to India in order to reduce their exposure to the Chinese market, according to senior Taiwan government policymakers, despite the self-governed island's increasingly hostile ties with China.
Kao Shien-Quey, Deputy Minister for Taiwan's National Development, stated that there is great potential for collaboration between New Delhi and Taipei in developing and crucial technologies such as semiconductor and electronics production.
She told a gathering of foreign journalists that large Taiwanese technology companies are turning to India to bolster their global supply networks.
Kristy Tsun-tzu Hsu, director of Taiwan ASEAN Studies Centre at Chung-Hua Institution of Economic Research, described India as an important country for Taiwan and stated that Taiwanese companies operating in China are considering "decoupling" the global supply chain from that country while keeping it for domestic consumers.
In light of Washington's trade battle with Beijing and the Chinese military's increased muscle-flexing near Taiwan, leading Taiwanese corporations are increasingly considering transferring their manufacturing bases from China to nations in Europe, North America, the United States, and India.
Following US House Speaker Nancy Pelosi's visit to Taiwan in August, ties between China and Taiwan have been more tense.
Taiwan Semiconductor Manufacturing Corporation (TSMC), the world's largest chipmaker, whose clients include Apple, is interested in having production facilities in India.
"Within the larger context of global supply chain restructuring and the 'China plus one' strategy, I am confident that collaboration between the two sides in the semiconductor and information and communication industries will accelerate," Shien-quey added.
It has been learned that a significant number of Taiwanese enterprises would establish production bases at two industrial parks in India that are being developed specifically for Taiwanese leading industries.
An official stated on condition of anonymity that negotiations for a Taiwanese semiconductor business to set up a manufacturing unit in India are nearing completion.
Taiwan manufactures about 70% of the world's semiconductors and more than 90% of the most modern chips necessary for practically all electronic equipment such as smartphones, automobile components, data centres, fighter planes, and AI technologies.
The 'China-Plus-One' approach encourages enterprises to grow their activities outside of China while remaining in the nation.
"We are actively promoting the diversification of Taiwanese companies' production bases, and we would like them to move their production bases to other countries with a like-minded value system," Shien-quey added.
According to Tsun-tzu Hsu, the Indian economy is very vast, and it may present some potential for Taiwan to shift its trade dynamics with China.
"It's not just about commerce. It is more about collaborative strategy. "Our companies were considering moving to India even before the trade war began because the Indian economy is so large that it can provide some opportunity for Taiwan to change the dynamics with China and reduce its reliance on China," she added.
Tsun-tzu Hsu stated that the Taiwanese government has been attempting to establish a trade agreement with India in order to broaden the trading basket.
Foxconn, Apple's main supplier, has an iPhone manufacturing facility in Tamil Nadu.
The business is now constructing a new iPhone manufacturing plant in Karnataka, which is anticipated to begin production in April of next year.
Nearly five years ago, New Delhi and Taipei signed a groundbreaking bilateral investment treaty to protect Taiwanese investment in India.
Bilateral commerce between India and Taiwan is growing. Trade volume climbed from $2 billion (about Rs. 16,361 crore) in 2006 to $8.9 billion (approximately Rs. 72,806 crore) in 2021.
"Recently, we've seen a surge in Taiwanese companies expanding their operations in India." "One such example is Foxconn's expansion," said Tsun-tzu Hsu.
According to Deputy Minister Shien-quey, there is plenty of possibility for collaboration between India and Taiwan in the semiconductor manufacturing sector.
"India has strong software capabilities, whereas Taiwan has strong hardware and manufacturing capabilities in the ICT sector." There is plenty of opportunity for complementary collaboration here. Second, India has a massive domestic market. "As a result, this is also an incentive for investment," she explained.
According to the deputy minister, Foxconn's activities in India are likely to attract additional technology businesses to invest in India.
"Because Foxconn is already there (in India), and some of Foxconn's suppliers in the lower part of the supply chain are also there," she added, "I am confident that this will attract more companies to invest in the upstream of the value chain."
China regards Taiwan as a renegade province that must be reunited with the mainland, by force if necessary. Taiwan, on the other hand, perceives itself as different from China.
Although India and Taiwan do not have formal diplomatic connections, they do have economic and people-to-people interactions.
Following the eastern Ladakh border dispute with China, several Indian specialists have advocated for strengthening New Delhi's ties with Taipei, particularly in the commercial and investment sectors.