‘India – Taiwan : Space for Expanding Cooperation’, 8th October 2021
Summary of Webinar on ‘India – Taiwan : Space for expanding cooperation’
The Indian Institute of Public Policy hosted a Webinar on ‘India – Taiwan : Space for expanding cooperation’ on 8th October 2021. The distinguished panel consisted of (i) H.E. Baushaun Ger, Taiwan Ambassador to India, (ii) Mr. Jason Hsu, Chief of Economic Division, Taipei Economic and Cultural Centre (TECC), (iii) Dr.Chih-Tsan Wang, Chief of Science Division, TECC, (iv) Mr.Peters Chen, Chief of Education Division, TECC, (v) Mr.Ben Wang, Director-General, TECC, (vi) Amb Dr. Mohan Kumar, Chairman, RIS, (vii) Mr.Ravi Bhoothalingam, Founder Chairman, Manas Advisory, (viii) Mr. Chocko Valliappa, Founder of Vee Technologies, (ix) Mr. HP. Kumar, former Chairperson / Managing Director, National Small Industries Corp Ltd, (x) Amb Bhaskar Balakrishnan, Science Diplomacy Fellow, RIS, (xi) Mr.Parth Sharma, President of Corporate Development, The Reliance Group, (xii) Amb Krishna V. Rajan, former Secretary, MEA and (xiii) Mr. KC. Sundaram, Director, IIPP.
The panelists unanimously agreed that there exists a great scope for cooperation between India and Taiwan in trade, investment, technology, education, etc. H.E. Baushaun Ger and other Taiwanese speakers presented the Taiwanese reality and their expectations with respect to India. Taiwan’s New Southbound policy in 2016 focused on cooperation in trade and investment, science and technology, education and culture, etc. The 2016 policy enlarged the scope for cooperation between Taiwan and South East Asia to South Asia. However, H.E. Ger believed that the last few years have not had enough momentum from Taiwan and India in the context of Act East policy and Southbound policy. Some of the difficulties that arise in the process of increased cooperation are (i) limited resources and funding allocated in dealing with India, (ii) language barriers for the people in MSME sector and (iii) the absence of a trade agreement between India and Taiwan. Thailand and Vietnam, though very small countries compared to India, host around 160,000 and 300,000 Taiwanese businesses respectively while India has only 200 Taiwanese businesses. It is a well-known fact that Taiwan is the largest manufacturer of semi-conductor chips in the world. This very well complements with India’s ever-growing demand and market for electronics and hardwares. Therefore, this is an important area for cooperation between India and Taiwan. The Taiwanese speakers also emphasized that bringing semi-conductor industry to India is not merely a business issue but a geo-political one.
Regarding Culture and Education, Mr.Peters Chen presented the statistics of migrating students between India and Taiwan. Although the number of Indian students in Taiwan are increasing (2783 students in 2019), Taiwan is ranked 13th in the list of destinations which Indian students prefer to migrate for education. Mr.Chen remarked that attempts should be made to bring Taiwan within the top 10 destinations for education for Indian students. There are 668 MoUs between Taiwan and Indian universities and 21 Taiwan Education Centres in India including 5 in Tamil Nadu. Using this network, Mr.Peters Chen, the Chief of Economic Division, TECC suggested few initiatives which can strengthen India – Taiwan cooperation in the education sector. Mr.Chen proposed that if Indian universities require Mandarin teachers, they can request the TECC which will manage the recruitment process and send a certified teacher to India within 2 months. He also suggested starting scholarships for Taiwanese students and teachers coming to India for study and research. Another suggestion put forth by Mr.Chen was to create an International Exchange platform where school students from India and Taiwan can visit each other’s countries and gain exposure to new culture and education.
After absorbing the presentations of the Taiwanese speakers, the Indian speakers put forth their ideas for cooperation with Taiwan from the Indian side. Mr.Ravi Bhoothalingam opines that Taiwan is a very strong supply chain player though not in the investment sector or consumer market, but in the mid markets. It is a trusted supplier to South East Asia, South Asia and also global markets. Taiwan is familiar with East Asian culture and Western norms and has a good network which can be utilized by India. However, Taiwanese supply chain producers are weary of big chaotic markets like India where language barrier also poses an issue. In order to make it more comfortable for the Taiwanese businesses, India needs to track the origin of the end product which are usually ASEAN countries and strike partnerships with them. This will mitigate the cultural barriers faced by Taiwanese businesses in India. ASEAN products easily enter India by virtue of the FTA, therefore India should use ASEAN as an entry point with respect to Taiwan. Industry organizations like CII, FICCI, etc can help SMEs on both sides by providing financial, legal and accounting support.
Ambassador Dr. Mohan Kumar highlighted that Taiwan is an independent member of the WTO and therefore India will not be crossing any ‘red lines’ in improving trade and investment relations with Taiwan. Ambassador Kumar differed with Mr.Bhoothalingam about India partnering with ASEAN to attract Taiwanese investments. Ambassador Kumar believes that Taiwan should invest directly in India and use the model of competitive federalism to its advantage. Amb Kumar also brought everyone’s attention to Invest India’s Taiwan+ initiative which is a one stop shop for Taiwanese investors to invest in India. He strongly believed that the ‘marriage’ between the Act East policy and New Southbound policy has not borne any fruits as expected. Therefore, informal efforts need to be taken to make the relationship fruitful. He also asserts that India must offer its EU investment agreement to Taiwan mutatis mutandis. He suggested that an open discussion of the bottlenecks faced by Taiwanese businesses will pave way for stronger cooperation in trade and investment between India and Taiwan.
Semi-conductor is the first thing that comes to mind when one thinks about Taiwan. Mr.Chocko Valliappa added that the services sector of Taiwan remains unexplored by India while it contributes about 30% of India – US trade (both import and export). Although Taiwan is the largest producer of semi-conductors, it requires a lot of Research and Development which goes behind the production of chip fabricators. Mr.Valliappa suggested that India can contribute to R&D of semi-conductors by partnering with Taiwan. Regarding India – Taiwan education collaboration, Mr.Valliappa used the example of Canada which has been investing in Indian education since 1980s, as a result of which India and Canada ties grew closer and now India has 10 Million USD collaboration with Canada in wearable technologies alone. Similarly, India should invest in Taiwanese education allowing the ties to grow closer and providing space for expanding cooperation. Since India has a vibrant startup ecosystem, Mr.Valliappa suggested that we could start a startup which collaborates among startups in India and Taiwan.
Mr. HP Kumar spoke specifically about the scope for collaboration in the MSME sector between Taiwan and India. MSME sector in India comprising of 63 million enterprises is largely inhabited by Micro Enterprises which are more than 95 percent of the entire MSME sector. A large number of such micro units are informal and unregistered business units.
Similarly, Taiwan also has a large part of its small enterprises in the category of micro units. With many similarities between the two countries in the MSME sector, both countries can enter into collaborative exchanges by sharing their best business practices and technologies. Since India has opened up almost all sectors for foreign direct investments, opportunities exist for establishing joint ventures and technical tie ups based on the competitive advantages of both countries in the areas of availability of Raw Materials and Technology. Skilling and entrepreneurship development is another area where Taiwanese organizations can work with Indian companies to set-up modern skilling and incubation facilities to improve the quality of work force as India has a large number of unskilled population. There is tremendous potential for both countries to work together in the area of Innovation, Research and Development which would promote the technological advancement and innovative research.
Ambassador Bhaskar Balakrishnan claimed that Taiwan offers great possibilities for Science and Technology cooperation with India. Two key indicators of this development are (i) Taiwan’s Gross expenditure on research and development (GERD) has risen to 3.6 percent of total gross domestic product (2018) compared to 0.7 % of GDP for India and (ii) Researchers per million population in Taiwan is 4100 in 2021 whereas in India it is 253. There exists an India-Taiwan Joint Committee on Cooperation in Science and Technology headed at the senior official level. The Indo-Taiwan S&T cooperation Programme extends financial support through Joint Calls for proposals (the most recent in 2019) to researchers in India to carry out research and scientific experimentation with their Taiwanese counterparts. Several priority areas have been listed like renewable energy, clean energy, IoT, big data, cybersecurity, micro/nano-electronics, embedded systems & sensors, biotechnology, health care including functional genomics, drug development, and biomedical devices, etc have been identified under the programme. India currently faces a serious deficit in critical technologies strategic sectors like electronics, semiconductors, telecommunications (5G), and industrial machinery, etc., and STI-related cooperation with Taiwan in these sectors (semiconductors, in particular) is of great importance for India. The STI-related cooperation can be mutually beneficial in emerging technologies like AI, and additive manufacturing. Under India’s Digital India initiative, the two countries can accelerate work on the ‘South Asian Silicon Valley’ development project.
Mr.Parth Sharma was of the opinion that in the Post-Covid era, India needs to diversify its supply chain while Taiwan needs to reduce its overdependence on China. Taiwan’s position as world leader in production of semi-conductor chips, electronics and hardwares complements India’s leadership in the IT and services sector. Partnerships with Taiwan in electronics would be hugely beneficial for India, since its electronic import expenditure is second only to its Petroleum import expenditure. Synergy between India’s e-commerce activities and Taiwan’s freight handling capacity will be extremely valuable to India’s warehousing and logistics technology and it will reduce the cost to Indian consumers. Taiwanese companies’ expertise in sustainable technology and green energy will help reduce the carbon footprint of India’s data centre operators. Collaborating with Taiwan in bringing bio-friendly technologies to India to combat air pollution is another excellent opportunity. While India and Taiwan are celebrating 25 years of partnership, now is the time to develop political and economic ties on their own without bringing the China factor.
After individual presentations, discussion amongst Taiwanese and Indian panellists commenced. H.E. Ger stated that there are very few people to people exchanges between India and Taiwan. Before Covid there were 20,000 people visiting India from Taiwan and 30,000 people visiting Taiwan from India. This number is quite low compared to the size of India. H.E. Ger suggested India needs to attract SMEs to come to India first as tourists so as to get to know the country which will later increase the trade and investment engagement. Taiwanese students who come to India to study can be encouraged to go back to Taiwan and act as a bridge between Taiwan and India. Both countries need to create a conducive environment for this cooperation. Lastly, H.E. Ger believes that if we don’t enlarge trade and investment between both countries we cannot move forward economically or politically.