Deep Dive | As India-China relationship goes cold, Taiwan could be the great eastern hope

With a Ladakh winter settling over India-China ties, the island nation of Taiwan could be the hand that New Delhi holds with more purpose and strength in time to come.

Taiwan is eyeing a huge growth impetus thanks to expanding trade with countries like India. Taiwan hopes for a 20 per cent year-over-year growth in trade with India in the backdrop of the New Southbound Policy (NSP) that was formulated in 2016. The NSP is focused on improving economic ties with 18 countries in the South and Southeast Asia, including India. The current political and trade climate between the United States and China and the ongoing tensions between New Delhi and Beijing are the perfect time to embolden ties between Taiwan and India.

Will India take advantage?

Trading climate between India and Taiwan

The core of the NSP warranted Taiwan to reach out to new investment and trading partners in order to reduce its dependence on China. Taiwan has succeeded in a great deal since 2016 by improving its trading ties with global superpowers. Experts feel Taiwan and India have still not leveraged each other in terms of trade and commerce.

New Delhi and Taipei in 2018 signed an updated bilateral investment agreement in a bid to further expand economic ties. At the beginning of 2019, the trade volume between India and Taiwan stood close to $7 billion. To compare this with China, Taiwan’s trade with China is around $160 billion. Indeed, India is only Taiwan’s 17th largest trading partner.

India has been cautious dealing with political notions of Taiwan, owing to the ‘One China Policy’ ever since the establishment of the India-Taipei Association in 1995 to promote bilateral relations. Beijing has maintained that Taiwan is an inalienable part of China’s territory.

Through the India-Taipei Association and the Taipei Economic and Cultural Center in Taipei and New Delhi respectively, both countries have worked together to scale business, tourism and cultural exchanges between the nations. These have led to multiple levels of bilateral agreements covering agriculture, technology, trade and industrial cooperation to name a few.

The slow nature of this relationship has, however, seen a shift in gear over the past few years. This could be felt in a recent exclusive interview of Foreign Minister of the Republic of China (Taiwan), Joseph Wu, to India Today TV. “To us, it is very important to improve relations with India. So far, we have 2.3 billion US dollars’ investment in India that employs about 65,000 people in the country and it is rapidly rising now, and we certainly hope that the trend can continue. Another area we think is very important for us right now is the supply chain,” said Joseph Wu.

India and Taiwan have shown an improved keenness in expanding economic and socio-cultural ties. The Taiwan External Trade Development Council (TAITRA) offices were set up in Delhi, Kolkata, Mumbai and Chennai in 2018 to expedite trade relations between the two nations. The bilateral trade, which stood at $1 billion in 2000, has now touched $7 billion in 2019.

Key companies like Wistron and Foxconn have pledged a spate of investments in India.

India and Taiwan can collaborate and complement each other very well via a plethora of services and technologies that either can offer to the other. Taiwan is a small country and hence there will always be the case of a smaller talent pool which India can comfortably fill. India, on the other hand, can gain access to high-end technology and competency that Taiwan possesses.

The Indian exports to Taiwan include iron, steel, mineral fuels, oil seeds, maize and organic chemicals. The imports from Taiwan are mostly computer chips, electrical equipment, plastics, machinery and tools.

Sana Hashmi, a Taiwan Fellow at the Institute of International Relations, National Chengchi University, and former consultant with India’s ministry of external affairs, spoke exclusively to India Today. When asked about the prospect of closer relationships between India and Taiwan, she replied “Since President Tsai Ing-wen took charge in 2016, the focus is on expanding Taiwan’s international outreach. One of the objectives of the New Southbound Policy, Taiwan’s flagship foreign policy, is to expand cooperation with countries which were not traditionally a part of Taiwan’s economic and strategic radar, and the focus areas include economic cooperation, people-to-people ties, resource sharing, etc. India is one of the focal countries of the New Southbound Policy and at the core of Taiwan’s South Asia policy.”

Call it a case of overbalancing or caution, the Indian government has never officially shown its closeness or any intentions of getting closer with Taiwan in recent decades.

“While there is great enthusiasm about Taiwan among Indian people, the government has not yet shown similar warmth towards Taiwan. In fact, Indian leadership was even criticised for not responding to Tsai Ing-wen’s birthday wishes to Prime Minister Narendra Modi and not wishing on Taiwan National Day on October 10. Till date, government-to-government interactions remain minimal and limited in scope. India remains cautious in elevating political ties and China factor looms large. However, this unprecedented support for Taiwan among Indians and China’s continued aggression has the potential to change the discourse about Taiwan in India,” Hashmi adds.

What does Taiwan bring to the table?

In the midst of the Covid-19 pandemic, one of the very few countries that have managed to successfully manoeuvre the challenges is Taiwan.

Taiwan as a nation had been preparing itself for this since SARS hit Taiwan in 2003. India must collaborate with Taiwan to shape and strengthen our digital healthcare and handling of large-scale pandemics.

“Areas such as health cooperation are also very important. During this whole period of Covid-19, we realised that relying on one certain country for medical supply is a national security problem. If we need to overcome that problem, then like-minded countries need to work closely with each other,” Taiwan Foreign Minister Joseph Wu told India Today TV.

“Awareness about Taiwan in India and India in Taiwan remained abysmally low for decades. Covid-19 has changed this,” said Hashmi adding, “It is important that India engages Taiwan in the health sector. Being democracies, India can learn so much from Taiwan’s best practices.”

“During the visit of US Health Secretary Alex Azar to Taiwan, Taipei and Washington signed an MoU in health cooperation. Given Taiwan’s successful Covid-19 response, having a similar arrangement with Taiwan will prove beneficial for India. While there is a collaboration between universities, cooperation at the government is yet to be achieved.”

Aside from this newfound success of Taiwan, the country has numerous other strengths that have stood the test of time, namely in the areas of semiconductor manufacturing, telecommunications and cyber technology the areas in which India lacks.

Taiwan’s is a global leader of the semiconductor industry. Owing to Taiwan’s early mover advantage and experience in the semiconductor industry, world leaders in electrical and electronic device manufacturers such as Samsung, Google and Apple depend on Taiwanese firms to produce customised chipsets for their devices.

Given their proximity to China and the dangers of the Chinese cybersecurity threats, Taiwan has also heavily invested in strengthening its cybersecurity capabilities. India Today had recently covered the threats faced by the Taiwanese semiconductor manufacturers and how they still manage to stay ahead of the competition and data theft.

Perhaps the biggest area in which bilateral trade can grow is the telecom industry. As India is looking to move towards 5G technology and follow in the footsteps of the US and the UK to prevent Huawei from entering its market, Taiwan may be the perfect partner to achieve this. Taiwan sits at the forefront of both the semi-conductor and 5G industry. Effective collaboration can provide a safe and secure network that will guarantee India’s future economic growth.

Taiwan can play an important role to further strengthen ‘Make in India’ initiatives to provide high quality, sustainable and affordable goods, and services.

Hashmi added, “At the economic front, while India is attempting to de-couple from China, India would need a technologically advanced country which could help replace China. Taiwan can be helpful in certain key sectors such as advanced technology sectors, infrastructure and connectivity, and even human capacity development.”

One positive development last week was the revival of the India-Taiwan Parliamentary Friendship Forum after a brief hiatus. This will lead to more political discussion among parliamentarians from India and Taiwan.

Given this newfound popularity and immense awareness of Taiwan in India, tourism is one sector that might get a boost once the pandemic eases. With this growing awareness, people-to-people ties seem to be beginning to improve between India and Taiwan.

What does India bring to the table?

While Taiwan can help India with technology and cybersecurity capabilities, India can share its wealthy knowledge in space technology both for commercial as well as defence-related collaborations.

The future will be driven by space technology and it is imperative that Taiwan can defend itself and its satellites given the options China has at its disposal. Space technology can help solidify Taiwan’s technological ambitions. What better way to do it by depending on a friendly nation that does not pose a threat to its territories?

Militarily speaking, India can look at strengthening military expertise of Taiwan by offering training to their Air force (unofficially, of course) similar to its past engagements with Indonesian and Vietnamese air forces. This will greatly aid the preparedness of the Taiwanese air force to thwart intrusion attempts of Chinese fighter planes that routinely violate Taiwanese air space.

Strategically speaking, as a nation that is to occupy the chair of the WHO’s Executive Board from January 2021, India should try and use this post to fight for Taiwan’s inclusion in the World Health Assembly (WHA). As a nation that exhibited exemplary thought and nous in handling the pandemic, Taiwan deserves its place among the world nations at WHA.

As mentioned before, India has a wealth of talent that can be exported to Taiwan to help build, shape and strengthen the topmost technological companies of Taiwan.

Educational ties between the two nations

Taiwan, on an average, offers around 100 scholarships to Indian university students each year. As of 2019, there are around to 2,398 Indian students pursuing higher education in Taiwan. The country also offers extensive language training programs for Indians.

Taiwan is host to 160 accredited universities that accept hundreds of thousands of international students each year. The educational cost accrued in Taiwan only amounts to 10 to 15 per cent of fees of universities in the West. Given, the degrees awarded by Taiwanese universities are recognised worldwide, it could be a very enticing option for Indian students in future. In order to fully maximise this, the Taiwanese government along with its universities has also provided various scholarship schemes to talented Indian students over the past few years.

Numerous Indians are part of Taiwanese research teams that are involved in R&D of some of the most advanced technology in the field of computers, cybersecurity, automobile engineering and others.

The strategic nature of the relationship

The relationship between the USA and Taiwan has also grown by leaps and bounds over the last few years. Especially, with the current face-off between the USA and China, the relations between the two nations have hit a new note. USA’s Health and Human Services Secretary Alex Azar recently visited Taiwan to acknowledge and highlight the stellar work done by its leadership during the pandemic. It was a first-of-its-kind visit by a US official in decades.

With Indian also looking to improve its relations with the East Asian countries, this is the best time to concretise its ties with Taiwan. It is interesting to note that Prime Minister Narendra Modi had visited Taiwan way back in 1999 as the BJP general secretary and had even hosted one of the biggest-ever business delegations from Taiwan in 2011 as Gujarat’s chief minister.

The biggest common point uniting India and Taiwan is the deep concern about China’s growing assertiveness in this part of the world. Taiwan has always traded with China, but the last decade has seen China getting more aggressive towards Taiwan. China, as a country too, has a lot of dependencies on Taiwan when it comes to semiconductor chips and technology. Hence, China has put in plans to reduce this dependency.

India and China do have a lot of commonalities when it comes to defending the rights of their respective nations. Exclusively speaking to India Today, Nicola Smith, Asia correspondent for the Telegraph based in Taiwan, said, “Having covered India for six years and Taiwan for four what strikes me is that although both countries are very different in terms of culture and economics, they both share the same respect for their democratic systems and willingness to defend their freedom, rights and principles.”

Taiwan’s concerns on Chinese aggressiveness are not imaginary, but real. The sovereignty of Taiwan cannot be disturbed come what may. China continues to view Taiwan as its breakaway province and has threatened to take over Taiwan in future, if necessary. China has also attempted to squeeze Taiwan’s international space and blocked Taiwan’s participation in international organisations.

She adds, “Taiwan would like closer ties with all countries and to be recognised as a global player. Taiwan’s very existence appears to anger China and there’s no reason why Taiwan should always frame the narrative in terms of how upset China will be about a particular issue. Taiwan has the right to operate on its own terms internationally.”

It is this constant threat that has led to Taiwan establishing a very well-connected network of surveillance and intelligence gathering that constantly sees, listens to and corroborates the happenings in China. It is this same network that first detected the spread of Covid-19 in Wuhan and reported the same to the WHO.

Taiwan also has a wealth of experience in dealing with China and knows China better than anyone else. This is not only out of surveillance, but Taiwan also has historical, ethnical, cultural, and linguistic ties with China. Taiwan has invested heavily on China studies and this is something India must take advantage of. Taiwan prefers to hold dialogue and is a nation that does not want to get itself entangled into a war.

Nicolas Smith corroborates this with her understanding of the region as below: “Taiwanese citizens are generally used to ongoing threats from China as part of their everyday lives as they’ve been facing this situation for decades. My impression is that most citizens want to be left in peace to live like the citizens of any other countries working, studying, spending time with their families. Nobody wants conflict and President Tsai Ing-wen has been clear on multiple occasions that her government supports the status quo and would like to have a dialogue with Beijing on equal terms.”

With the newly formed quadrilateral (Quad) mechanism between India, Australia, Japan and the US taking shape, Taiwan can benefit a great deal from this. With Taiwan already well connected with the USA, getting closer to India may even open new opportunities in terms of trade and strategic benefits.

“I think Quad is very important. We are watching very closely the development of this quadrilateral cooperation China is not the only issue that all these four countries are discussing. There are so many international issues that the Quad can come together in working with each other for the security issues and other issues. We are very happy to see that the like-minded countries in the Indo-Pacific are working with each other to deal with the common threat in this region,” said Taiwan Foreign Minister Joseph Wu in the interview.

On the general state of mind of Taiwanese citizens in today’s political climate, Hashmi commented: “Majority of young Taiwanese are more aligned towards associating themselves as more Taiwanese than Chinese- asserting identity that is different from Chinese identity. Taiwan public is favourable to more cooperation with the US and even countries such as Japan and India. While this support necessarily does not entail direct confrontation with China, most Taiwanese are tilted towards maintaining the status quo vis-à-vis Cross-Strait ties.”

India’s new envoy to Taipei, Joint Secretary Gourangalal Das, was previously heading the US division of India’s Ministry of External Affairs. Das’ appointment was widely publicised, and this was a stark contrast to previous appointments. This happened soon after the face-off between Indian and Chinese army personnel at Ladakh.

Das is said to be fluent in Mandarin and has the experience of working at the Indian Embassy in Beijing between 2006 and 2009. Later, he was posted to the Indian Embassy in Washington. He is a key figure part of the team that arranged the meeting between Modi and Trump at Washington in 2017. The key point is that Das was also part of the team that revived the Quad mechanism. It is no wonder that this appointment is being seen as a very strategic one.

The way forward

Let us not get ahead of ourselves. India is not going to sign military deals with Taiwan or do anything that angers China. India will continue to walk the tightrope in balancing its relationship between China and Taiwan. However, India should look to pursue its relationship with Taiwan at a more realistic level.

The plan should be to pursue goals that help to take the relationship to the next level. The two nations must facilitate and nurture existing and new platforms to enable deeper collaborations between its people and businesses.

Taiwan must not solely be viewed as a country that will solve our technological requirements, but as a partner that will stay true to its word. Taiwan, on its side, must ensure to respect the political and diplomatic stands taken by India in the past and future. Only then will the relationship fructify.

On asked about the future of the relationship between the nations ever since President Tsai Ing-wen’s re-election, Hashmi added: “Taiwan, under President Tsai Ing-wen, has already realised the significance of engaging India. In fact, she has, time and again, expressed the desire to expand cooperation with India. Her recent tweets about her visit to India and fondness for Indian food have led to further likeliness and popularity of Taiwan among Indians. In a country like India, popular sentiments often compel governments to take actions. To sustain the momentum in future, what’s needed is the concrete efforts from both sides.”

(The writer is a Singapore-based Open-Source Intelligence analyst)

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