Plug into Taiwan: New Delhi must pursue trade deal with Taipei, ignoring Beijing


With reports surfacing that India is looking to start discussions for a trade deal with Taiwan, the Chinese foreign ministry has asked New Delhi to be prudent while dealing with Taipei and reiterated its so-called ‘One China’ principle which sees Taiwan as part of China. This is rich coming from Beijing, which has shown scant regard for the sovereign interests of other countries. Besides, China has no business telling India with whom it can do trade deals. The reality is Taiwan today is a free and independent democracy, and an Asian economic dynamo.

Trade between India and Taiwan grew 18% to $7.2 billion in 2019, but there is much headroom for growth. Taiwan is a powerhouse in semiconductors that serve as the backbone of today’s modern economies. Taiwanese companies are well-integrated into global supply chains, bringing high standards of production and logistics to the table. True, Taiwanese companies also do a lot of business in China – which is precisely why it’s hypocritical of Beijing to object to a trade deal between New Delhi and Taipei. But many Taiwanese companies are looking to relocate out of China because of the US-China trade war, disruptions caused by Covid-19, and growing tension between Beijing and Taipei.

Add to this Taiwan’s New Southbound Policy that is looking to enhance its connections with 18 countries, including India. Taiwan’s expertise in hardware and India’s in software are a perfect fit. New Delhi shouldn’t be averse to a free trade agreement with Taipei as the latter is higher up the value chain. Taiwanese investments in technology can kick start a tech manufacturing revolution in India. With China breathing down both India’s and Taiwan’s necks, there is additional incentive to create alternative supply chains and cut out Beijing. India-Taiwan ties are a win-win. China’s objections should be ignored.

This piece appeared as an editorial opinion in the print edition of The Times of India.

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