Semiconductors dominate headlines on India-Taiwan cooperation, but another sector with equal strategic weight and faster potential impact is aerospace. India has decades of experience in space exploration, defense aviation and manufacturing, while Taiwan brings precision engineering, avionics expertise and integration into global aerospace supply chains. Together, these strengths could reshape the Indo-Pacific region’s industrial and security landscape, diversify production away from dominant supply chains and build a resilient, high-value aerospace ecosystem.
The aerospace industry is undergoing a profound transformation. COVID-19 disruptions, including lockdowns, labor shortages and shipping bottlenecks, exposed vulnerabilities in supply chains long concentrated in the West. Geopolitical risks, such as US-China tensions and the war in Ukraine, further strained access to critical materials, delaying aircraft deliveries and increasing costs. Major companies such as Airbus, Rolls-Royce, Collins Aerospace and Pratt & Whitney are diversifying aggressively, shifting manufacturing and procurement toward Asia to mitigate the risks. India has emerged as one of the main beneficiaries of the transition.
Backed by its Make in India initiative, a targeted Production-Linked Incentive (PLI) scheme for drones and aerospace components worth roughly US$14 million, and liberalized defense investment norms allowing 74 percent automatic foreign ownership, the country is becoming an attractive partner for aerospace original equipment manufacturers.
Airbus has awarded Indian suppliers multiple aircraft door contracts and, alongside Tata Advanced Systems, is localizing major structures and final assembly of the C-295 transport aircraft, displaying confidence in India’s ability to handle complex aerospace programs.
India has set a goal of capturing 10 percent of the global aerospace supply chain within the next decade, a target bolstered by the Asia-Pacific region’s rapid post-pandemic recovery, with industry revenues projected to exceed pre-2019 levels by more than 50 percent.
Unlike semiconductors, an industry that India is still building foundational infrastructure for, aerospace and space are sectors of demonstrated expertise. The Indian Space Research Organisation has earned global respect for low-cost innovation, from the Mars Orbiter Mission, which reached Mars orbit on its first attempt in 2014, to Chandrayaan-3’s landmark lunar south pole landing in 2023. Upcoming projects, including the Gaganyaan crewed mission and a planned Indian space station targeted for 2035, reflect ambitious long-term goals.
India’s defense aerospace achievements are also notable, with platforms such as the Tejas Light Combat Aircraft and Dhruv helicopters developed indigenously, while technology partnerships with the US and Europe, including joint production of General Electric F414 engines for warplanes, highlight a growing role in advanced defense manufacturing. The country’s geographic position, expanding aviation market and engineering talent pool further strengthen its aspirations to become a maintenance, repair and overhaul hub for Asia’s aircraft fleets, reducing reliance on facilities in Singapore and Europe.
Taiwan’s aerospace sector, while smaller in scale, offers sophistication that complements India’s strengths. Led by the Aerospace Industrial Development Corp and the National Chungshan Institute of Science and Technology, Taiwan manufactures advanced trainers such as the T-5 Brave Eagle, upgrades to the Indigenous Defense Fighter, and a range of uncrewed aerial vehicles and avionics systems.
Taiwanese suppliers are deeply embedded in global original equipment manufacturer networks, maintaining AS9100 aerospace certification standards that make them trusted partners for Airbus, Boeing and Lockheed Martin. Also Taiwan’s Third-Phase National Space Program (2019 to 2028), with a budget of about US$814 million to US$834 million, focuses on annual satellite launches, and developing domestic rocket capabilities and launch infrastructure.
The initiatives demonstrate Taiwan’s commitment to expanding its aerospace industry beyond defense manufacturing. Taiwan has also bolstered ties with Estonia and the US as part of broader efforts to diversify its high-tech production base and enhance supply chain resilience.
The convergence of India’s scale, cost advantages and engineering capability with Taiwan’s manufacturing precision and certification expertise creates a compelling case for collaboration.
In October 2022, the Taiwan Space Industry Development Association and the SatCom Industry Association of India signed a memorandum of understanding at the India Space Congress, committing to exchanges and joint initiatives in space technology and satellite communications.
However, the agreement has been overshadowed by semiconductor headlines. Reviving it and tying it to visible industrial projects would give both countries a first-mover advantage in aerospace, a sector in which they already hold credible capabilities.
Telangana’s Taiwan-focused industrial park, widely known as Formosa Town, has secured more than US$230 million in investments from about 11 Taiwanese companies and offers a ready-made base for aerospace ventures.
India and Taiwan do not have formal diplomatic relations, so collaborations in strategic sectors often develop through industry associations, research institutions and private enterprises. Still, the opportunities are significant. Joint aerospace research-and-development centers could accelerate innovation in drones, avionics and propulsion systems, while regional maintenance, repair and overhaul hubs in India would help meet the needs of Asia’s expanding aviation market.
Aerospace offers a faster route to tangible results than semiconductors, which demand massive investment, intricate supply chains and long development timelines. India and Taiwan already possess the infrastructure, expertise and credibility to scale aerospace production. By combining India’s engineering capacity and cost efficiency with Taiwan’s manufacturing precision and integration into global supply chains, the two economies could position themselves as key players in a rapidly evolving aerospace market.
The symbolism of such collaboration is equally significant. An aerospace alliance would demonstrate India and Taiwan’s ability to coordinate in sensitive, high-technology industries, positioning them as proactive contributors to the future of the Indo-Pacific region. It aligns with growing defense partnerships between India, the US, Japan and Europe, reinforcing the message that like-minded democracies can jointly lead critical supply chains.
In an era of heightened geopolitical competition, aerospace cooperation would deliver economic benefits, technological progress and improve the strategic autonomy of both countries.
Uma Chinnannan is a doctoral candidate in the International Doctoral Program in Asia-Pacific Studies at National Chengchi University.
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