Taiwan’s Role in Helping India Reduce Trade Deficit with China
Taiwan’s Deputy National Security Adviser, Hsu Szu-Chien, stated that Taiwan can assist India in reducing its trade deficit with China by providing electronic components. He emphasized the importance of a free trade pact to facilitate investments and joint production in high-tech sectors. The collaboration could leverage Taiwan’s technology and India’s demographic advantage, fostering an optimistic future for economic cooperation between the nations.
Taiwan’s Deputy National Security Adviser, Hsu Szu-Chien, emphasized that Taiwan can assist India in mitigating its significant trade deficit with China by providing alternatives for electronic components. In an interview, Hsu highlighted that a free trade agreement could encourage Taiwanese investments in India’s semiconductor and high-tech industries, thus reducing the impediments presented by high tariffs.
Hsu participated in the Raisina Dialogue in New Delhi, where he suggested a synergistic relationship between Taiwan’s technology and India’s demographic advantages, facilitating the production of high-end technology components locally. He noted that this collaboration could significantly lower India’s imports from China, specifically in information and communication technology products.
With India’s trade deficit with China reaching $101.75 billion in the fiscal year 2023-24, Hsu advocated for collaborative manufacturing of electronic components, rather than continued reliance on imports. He expressed confidence that the combination of Taiwan’s technology and India’s youthful workforce could lead to fruitful economic cooperation.
During his visit, Hsu articulated Taiwan’s strong desire to negotiate a trade pact with India, highlighting that current tariffs create challenges for Taiwanese companies, especially smaller high-tech firms looking to invest. He underscored the mutual benefits a trade deal would bring and reported that preliminary discussions for a free trade agreement have already taken place.
Taiwanese firms are increasingly considering relocating production from China due to geopolitical tensions and economic conditions, with India emerging as a favorable alternative. Under the “Make in India” initiative, Taiwanese investments in India have surpassed $4 billion and encompass various sectors from machinery to ICT products.
Despite the absence of formal diplomatic relations, trade ties between India and Taiwan have seen significant growth since the establishment of the India-Taipei Association in 1995, which facilitates business and cultural exchanges. Through these channels, both countries are exploring ways to enhance their economic cooperation while navigating complex geopolitical landscapes.
In summary, Taiwan’s Deputy National Security Adviser Hsu Szu-Chien outlined the potential for enhanced economic cooperation between Taiwan and India. By establishing a free trade agreement, both nations could benefit from increased Taiwanese investment in India’s semiconductor and high-tech industries, addressing the significant trade deficit India faces with China. The collaboration leverages Taiwan’s technological expertise and India’s demographic advantages, creating an optimistic outlook for future bilateral trade relations. The discussions held during the Raisina Dialogue mark a crucial step towards solidifying this partnership, with both sides keen to pursue negotiations for a formal trade pact.
Original Source: www.business-standard.com
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