Monday, July 13, 2020

Taiwan-India Robust Bilateral Relationship

Sadia Rahman
PhD Student National Chung Hsing University


The academic interest during the past decades regarding Taiwan-India bilateral
relationship lack pursuit; however, much has changed since the last past ten years.
Much scholarly attention has been given under a general unanimous voice that
Taiwan-India should have a ‘robust bilateral relationship.’ Joe Thomas Karackattu,
an expert on India-Taiwan and India-China relationships, made a very intriguing
argument as what qualifies small or big when analyzing bilateral relations. It is
the study of Taiwan-India bilateral relationship that challenges our assumptions
on parameters of size. Geographically size of India is much more prominent
when compared with Taiwan but strengthening a robust bilateral relationship will
be fruitful to India noted by Prashant Kumar Singh because Taiwan has a much
larger per capita GDP and a significant distinction in science and Technology.
India remains in Stage I economies, i.e., in the factor-driven stage, while Taiwan
is part of the Stage III economies, i.e. highest tier group of 35 innovation-driven
economies worldwide. Hence, this alters the perception of big and small. Taiwan-
India bilateral relationship has witnessed a rough period of no contact until 1995
The India-Taipei Association (ITA) in Taiwan and the Taipei Economic and
Cultural Centre (TECC) in India were established. These two Representative
offices in respective countries have functioned to give a direction; they worked as
official channels without any formal diplomatic attachments. It has been 25 years of
the establishment of the representative offices, and this article in optimistic tonality
argues that now is the apt time to strengthen Taiwan-India bilateral relationship.
Much has been written regarding the circumspection in this bilateral relationship,
i.e. the regional cooperation between India and Taiwan is still conjectural in nature, much-awaited FTA is still on hold which hinders the two countries towards the path
of having a flourishing relationship. In the past ambiguousness was the reason that
plagued Taiwan-India bilateral relationship, there was no long-term vision which
reveals why such an absent-minded approach was adopted. The organic problem
in Taiwan-India bilateral relationship is the maze of complicated political factors
given the core issue of contestation of Taiwan’s status in world affairs and India’s
adherence to One China Policy remains more fragile to pursue.

However, bypassing the ambiguity that plagued Taiwan-India bilateral
relationship this article will provide optimistic reasons to strengthen the bilateral
relationship. This article will develop scholarship that focusses on building a
robust relationship. In connection to that, according to Taiwan News now Indian
academicians are also reiterating in the tone to encourage Taiwan-India ties.
Srikanth Kondapalli, an Indian Sinologist, believes “Taiwan should explore more
to foster the bilateral relationship and collaboration should be strengthened under
the framework of Taiwan’s New South Bound Policy (NSP)and India’s Look East
Policy which is also known as Act East Policy (AEP).” Similarly, Namrata Hasija,
Research Associate with the Centre for China Analysis and Strategy, has been one
of the influential voices backing to strengthen Taiwan-India bilateral relationship.
She has written many articles on this particular issue but what makes her stance
different is that she argues form the perspective that India should not behave
ambiguously and instead develop an independent bilateral relationship with Taiwan
across economic and strategic sectors. While Taiwanese scholar Fang, Tien-Sze in
the article titled “India-Taiwan Relations: A Comprehensive Security Perspective”
observed that despite having so many ongoing government-funded joint research
projects Taiwan-India bilateral relationship is still in small scale when compared
to the potentials. Constrained by its commitment to China’s One China Policy,
India finds it difficult to realize the potential of its bilateral relationship with
Taiwan. Thus, this article discusses what should be done to build a robust bilateral

Bypassing the Circumspection:

Scholars have unanimously noted strengthening people to people relations is
one of the ways to enhance Taiwan-India bilateral relationship. This article does
not doubt this proposition; however, this article argues that now the focus should
be beyond that, i.e. carving out policies and implementing them so that the bilateral
relationship thrives. ‘Strengthening people-to-people’ have just been confined as a
mere proposition; now is the appropriate time to propose alternatives. According to
a Business Today news former TECC Representative Ambassador Chung Kwang
Tien Taiwan has been persuading India to improve the bilateral relationship and
is not intending to establish a formal diplomatic relation. India should concretely
reciprocate the proposal of Taiwan shunning down its ambiguous actions and
policies towards Taiwan. The significant step that should be undertaken is to change
the mindset of been seen as an ‘option.’ A common phrase is always heard that
India is a booming market which has not yet saturated, and Taiwan should invest
in India to do business. However, this phrase is always used as an option citing
the various reasons for difficulty in doing business in India (which this article will
discuss further). On the Indian side the same attitude of as an option is witnessed
because the leaders are oscillating to maintain a balance between China and Taiwan
and not angry China or use Taiwan as a trump card against China. Thus, this notion
of optionality needs to be modified by giving the version of ‘pragmatism’ where
both the nations have to deal things more realistically, i.e. just by talking that this
bilateral relationship has the potential, but no sound efforts or one-sided effort
towards progress will only serve as a hindrance towards building a robust bilateral

Sharing strong economic relations is the first step for any country to enhance
and strengthen ties between the two nations. The past decade has witnessed
Taiwan-India bilateral trade increase at an average two-digit rate, and it reached
a historic high at US$ 7.57 billion in 2011. A similar condition is regarding the
investments. Given both the Countries through its official NSP and AEP policies
seek to target respective potentialities in building a robust relationship; however, the bilateral relationship still maintains the status quo. Taiwan seeks to have
collaboration with India in areas such as industrial supply chains, education and
exchange programs, agricultural cooperation, e-commerce, tourism though such
associations would be built to leverage multilateral cooperation’s what lacks is the
proactive approach. What hampers Taiwan-India economic relationship is ‘no ease
of doing business in India’ along with the host of other factors. The complicated
tax regulations, corruption, lack of understanding of investment environments, and
consulting problems because of language and cultural differences. Even though
these are the grey areas eclipsing the bilateral relationship, but these are not nonsolvable
hindrances. A pragmatic approach is the need of the hour to bypass such
difficulties. India needs investments; it also requires a reliable partner to have a
robust economic relationship; thus, India should behave in a sound manner making
flexible policies, ease the complicated tax regulations to attract more Taiwanese
investments. For the Taiwanese counterparts, the attitude that India has different
language and culture won’t help in enhancing the bilateral relationship. Taiwanese
businessmen should be smart in tapping the correct direction, i.e., approaching
the state ministers/leaders in which Indian state it wants to invest this will help in
reducing the difficulty level, and the process becomes much smoother.

The current ruling party of Taiwan DPP is much keener in strengthening
the bilateral relationship with India; thus, the priority should be in channelizing
efforts and resources that will only help in overcoming the structural challenges.
Taiwan’s Ministry of Economic Affairs since 2003 has looked upon India as a
priority of the export market because India has the potential to become an essential
destination for diversifying Taiwan’s trade as both countries are looking partners
to shed its economic dependency from China. Thus, enhancing a robust bilateral
relationship creates a win-win situation for both countries. In similar connection
citing an instance of avenue to build cooperation, according to a 2010 report by the
Indian Ministry of Electronics and Information Technology demand for electronic
hardware in India by 2020 was estimated to grow $400 billion. However, India’s
expected production capacity projected to reach only $104 billion by then creating
a gap of $296 billion. In 2019 Government of India (GoI) set forth the National Electronic Policy revising the 2010 demand for electronic hardware to achieve the
target by 2020, the new objective was to reach the $400 billion domestic market for
electronic hardware by 2025. Here lies the opportunity for Taiwan, India is seeking
for reliable partnership, and since it’s a known fact that Taiwan is significantly
good in the hardware industry Taiwan can help India to meet the expected target
building a robust bilateral relationship. Along with that Taiwan should prepare itself
to leverage India’s digital revolution and also to manufacture some goods in India
gaining market share for its firm. It is not only economically fruitful to strengthen
the bilateral relationship, but strategically also, this bilateral relationship is a viable
option where maritime security is of utmost importance. Taiwan not only has a
crucial linking point for important sea lanes in Indo-Pacific and has a proximate
location to South China sea enhancing ties with Taiwan will provide India with a
vantage in maritime security. The Asia-Pacific architecture also encourages and
presents opportunities for more strategic and commercial cooperation between
Taiwan and India bypassing to have seaborne trade.

Few years before in 2017, for a similar research project on Taiwan-India
relationship, I had the opportunity to interview former Director-General from
India to Taiwan Sridharan Madhusudhanan to discuss on Taiwan-India bilateral
relationship. Recollecting the interview, he very precisely mentioned specific points
focusing on the economic, education, cultural areas where both countries should
look into to enhance the relationship. The fascinating argument made by him was
creating the “Taiwan Cluster Model” in India. To do business in India, it is essential
for Taiwan to be famous or to be known as a Taiwanese company and not being
overshadowed under the name as a Chinese company to thrive in the Indian market.
Along with that since Taiwan is good in Small and Medium Enterprises (SMEs),
a prominent Taiwanese company when entering Indian market shall enter with the
SMEs in this way the SMEs gets the confidence to do business in India. This will
result in creating a business cycle forming Taiwan cluster in India in areas such
as electronics, machinery, food processing. If this cluster formation happens, this
will change the nature of Taiwan-India bilateral relationship. Apart from Taiwan
cluster model, education was another area which both countries should focus on a pragmatic approach and not only a long-term investment in the education sector,
but proper comprehensive planning is required. As of now, it is only the Taiwan
government which offers academic scholarships to Indian students, while first,
this should be a complementary approach where Taiwanese students should also
get an opportunity to visit India to study this will help in knowing India better.
Second, a greater understanding of Taiwan will come from those Indian students
who are studying in Taiwan and exchange students working as an imperative for
any sustainable relationship. Thus, the education should go along with the concept
of Supply Chain Vocational Training Model, i.e., proper planning needs to be done
in awarding scholarships, how a particular scholarship recipient can contribute in
strengthening Taiwan-India relationship. Indian students who come to Taiwan on a
scholarship to study in any Taiwan University it should be part of their scholarship
curriculum that a scholarship awardee needs to learn the Chinese language and
to do some training/internship in any big Taiwanese company in Taiwan. When
the scholarship candidate graduates, the advantage will be that the student will
know the language, will be familiar with the Taiwanese culture and the working
environment. Such students can only contribute; he can work for Taiwanese firm
in Taiwan or back in India in any Taiwanese company. If something like this,
i.e. utilizing student, capabilities happen, this will contribute to strengthening
people-to-people relations and a concrete step towards building a robust bilateral


Apart from identifying the areas of cooperation as this article mentions and
presented an optimistic vision of Taiwan-India bilateral relationship much depends
on the will by the ministries of both sides then only the institutionalization of the
efforts would take place. Expanding the consultative space and the frequency of
dialogues needs to increase and India should realize that Taiwan is the reliable
partner which India needs.

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