Recently, the island nation of Taiwan has declared its intentions to establish its third representative Taipei Economic and Cultural Centre (TECC), in India, specifically in Mumbai. This move is a strategic initiative aimed towards increasing economic ties and bolstering bilateral cooperation ties between Taiwan and India. The first TECC had been started in New Delhi, India in 1995, marking it as the inaugural TECC in the South Asian region. In 2012, another TECC was inaugurated in Chennai.
China’s Reaction and Geopolitical Implications to Taiwan’s Plan
China has always opposed any official recognition or contact of Taiwan by other nations, stating that such actions infringe upon the One China policy. In response to the latest initiative by Taiwan, China might express objections and possibly take diplomatic or economic measures. The changing relationship dynamics between India and Taiwan remains a sensitive point for China, considering its consistent efforts to limit Taiwan’s diplomatic reach. However, current tensions between China and India along the Line of Actual Control may see China exercising restraint to avoid further escalation.
India-Taiwan Relations: An Overview
Formal diplomatic relations between India and Taiwan are still lacking. However, post-1995, both countries have maintained representative offices in the other’s capital city, functioning as de facto embassies. India has historically supported the “one-China policy”.
Economic Cooperation Between India and Taiwan
Trade ties between India and Taiwan have seen a significant increase, from USD 1 billion in 2000 to USD 7.5 billion in 2019. In 2018, both countries signed a bilateral investment agreement. Approximately 200 Taiwanese companies operate in India, spanning sectors like electronics, construction, petrochemicals, machinery, Information and Communications Technology, and auto parts. A collaborative initiative is underway to establish a semiconductor manufacturing hub in India.
India-Taiwan Cultural Connections
The cultural relations between India and Taiwan have also strengthened over the years. There have been expanded educational exchanges between the two countries following a mutual degree recognition agreement in higher education, which was signed in 2010.
Opportunities for Strengthening India-Taiwan Relations
There exist several potential areas of collaboration between India and Taiwan. Taiwan’s proficiency in R&D and entrepreneurship can complement India’s talent pool and digital economy, thereby encouraging collaboration in emerging technologies. It’s worth noting that Taiwan produces over 60% of the world’s semiconductors and over 90% of the most advanced ones. Both nations share a vision of a free, open, and inclusive Indo-Pacific region, which can lead to cooperation on maritime security, counter-terrorism, and disaster management initiatives.
Challenges in India-Taiwan Relations
Despite these opportunities, challenges also permeate the relations between India and Taiwan. India’s adherence to the One China policy prevents it from fully realizing the potential of its bilateral relationship with Taiwan. Furthermore, increased investments from Taiwan face cultural challenges, bureaucratic hurdles, and pressure from domestic producers on the Indian side.