The relationship between India and Taiwan is evolving, driven by a shared understanding of the need for enhanced cooperation across various sectors. While the semiconductor industry has captured significant attention due to its strategic importance and mutual economic interests, it is equally important to explore and address other areas of potential collaboration between the two countries.
The India Semiconductor Mission is a government initiative that allocates US$10 billion to build a robust semiconductor ecosystem in India. It offers financial support covering up to 50 percent of project costs for fabrication plants and related initiatives, aiming to establish India as a key player in the global semiconductor supply chain. Indian Prime Minister Narendra Modi’s vision of “Make in India” and “Design in India” has driven government incentives across various facets of semiconductor production, underscoring the momentum behind recent semiconductor ties. Recent months have seen significant strides in India’s efforts to develop a vibrant semiconductor and electronics ecosystem, exemplified by the agreement between Tata Electronics and Taiwan’s Powerchip Semiconductor Manufacturing Corp to establish a new fabrication facility.
However, this focus on semiconductors, while important, should not overshadow the broader potential for Taiwan-India cooperation. The current political climates in both nations, with the Democratic Progressive Party in Taiwan and the Bharatiya Janata Party in India, present a unique opportunity to advance relations beyond a single industry. Both countries face multiple domestic and geopolitical challenges, including managing China’s assertiveness, highlighting the pressing need to deepen people-to-people ties, and explore a wider range of economic and cultural collaborations.
About 200 Taiwanese businesses have made investments in sectors such as electronics, information and communications technology, petrochemicals, steel, shipping, footwear manufacturing, automotive and motorcycle components, finance and construction, data from the Taipei Economic and Cultural Center (TECC) in India showed. Taiwanese companies are increasingly investing in India, particularly in sectors such as footwear and high-tech manufacturing. Notably, Pou Chen Group, the world’s largest shoe manufacturer, last year announced that it would set up a facility in Tamil Nadu with an investment of about US$280 million, which is expected to create about 20,000 jobs. Meanwhile, Hong Fu Group revealed an investment of about US$120 million in the same region at about the same time. Other Taiwanese firms, including Shoetown and Feng Tay, are establishing non-leather footwear manufacturing in Tamil Nadu, capitalizing on the state’s favorable business environment and incentives.
A delegation from the Indian state of Bihar, led by Additional Chief Secretary Sandeep Poundrik, in November last year visited I-Mei Foods to encourage the company to consider expanding its operations in the state. Additionally, Bihar has partnered with the TECC to establish Mandarin learning centers in Patna, aimed at training Indian workers for roles in Taiwanese companies. This showcases that, in addition to footwear, Taiwanese companies can explore opportunities in electronics, electric vehicles, smart healthcare, food security and more, driven by India’s growing market and supportive government policies. This trend reflects a strategic shift in Taiwanese manufacturing as companies diversify supply chains away from China, leveraging India’s skilled workforce and investment-friendly climate.
While economic cooperation remains crucial, it is equally vital to focus on other forms of collaboration, and address the existing ties between India and Taiwan. Since the introduction of Taiwan’s New Southbound Policy, the number of Indian students in Taiwan has risen significantly, with about 500 receiving government scholarships. Taiwan currently hosts about 3,000 Indian students, predominantly in science, technology, engineering and mathematics, with a smaller presence in humanities, arts and language programs. As Taiwan faces a talent shortage and an aging population, it is essential to consider how to retain these talented students. While efforts to boost Taiwan’s declining birthrate might help, the country would need to rely on foreign workers to fill the labor gap. This realization prompted the government, under the administration of former president Tsai Ing-wen (蔡英文), to implement various policies to attract and retain global talent, including from India.
Revisions to programs such as the Employment Gold Card scheme have successfully drawn skilled professionals to Taiwan. As of March, 9,664 Employment Gold Cards had been issued. The government has also enhanced cooperation with industry and educational institutions to develop and retain talent. Initiatives such as the International Industrial Talents Education Special Program recruit from abroad and provide government-funded scholarships for enterprises. New Southbound industry-academia collaboration programs recruit foreign students from New Southbound countries and host specialized customized programs. Additionally, the government has relaxed restrictions to allow graduating foreign students to work in Taiwan after completing their studies, leading to a significant increase in the proportion of foreign students choosing to remain in Taiwan, from 30 percent to 65 percent. These comprehensive measures demonstrate Taiwan’s strong commitment to attracting and retaining global talent, including those from India.
In conclusion, the evolving Taiwan-India relationship holds immense potential. Beyond the semiconductor industry, there are significant opportunities to deepen economic, educational and cultural ties. Taiwan’s skilled workforce and India’s growing market, coupled with supportive government policies, create a conducive environment for further collaboration. By diversifying economic cooperation, fostering people-to-people relations and addressing common geopolitical challenges, India and Taiwan can strengthen their strategic partnership and unlock new avenues for mutual prosperity.
Uma Chinnannan is a doctoral candidate in the International Doctoral Program in Asia-Pacific Studies at National Chengchi University.
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