Amid China concerns, Taiwanese firms redirect supply chains to India
Taiwanese firms are increasingly relocating their supply chains from China to India, a move driven by escalating global trade tensions, particularly between the US and China. James Huang, chairman of the Taiwan External Trade Development Council, revealed that Taiwan's foreign direct investment in India has surged to over $665 million in the five years leading up to 2023. "It is evident that more Taiwanese companies are moving supply chains out of China and are establishing them in India," stated Huang.
India-Taiwan economic ties strengthen despite absence of formal relations
Despite the absence of formal ties with Taiwan, India has nurtured a close business relationship with the major chip-producing nation. This shift in Taiwanese investment is significant compared to the previous decade from 2006 to 2017, when Taiwan's FDI in India was nearly $277 million. The burgeoning economic cooperation between India and Taiwan comes amid strained relations between India and China, particularly over a disputed shared border that led to their deadliest clash in decades back in 2020.
Taiwan's Powerchip and India's Tata Group partner for semiconductor facility
In a significant development this year, Taiwan's Powerchip Semiconductor Manufacturing Corp joined hands with India's Tata Group to construct the first semiconductor fabrication facility in Gujarat. This project is backed by a $10 billion incentive scheme. Huang also highlighted programs designed to train Indian students and talents in Taiwan's semiconductor industry, which he believes will "pave the way for future cooperation."
India-Taiwan trade reaches $10 billion in fiscal year 2024
The two-way trade between India and Taiwan reached a significant milestone, hitting $10.1 billion during the financial year ending in March 2024. This growth is indicative of the strengthening economic ties between the two nations, despite geopolitical tensions with China. The shift in Taiwanese investment and supply chains to India has played a crucial role in this increase, particularly impacting mobile telephone assembly industries and footwear sectors.
