The FICCI report, “India–Taiwan Economic Relations: New Frontiers of Cooperation,” highlights a period of accelerated commercial synergy, with bilateral trade more than doubling over the last five years, rising from US$5.65 billion in 2020–21 to US$11.78 billion in 2024–25. This growth is heavily reliant on India’s rising demand for advanced Taiwanese components, with imports reaching US$10 billion in 2024–25.
Key Pillars of Economic Engagement:
Investment and Job Creation: Nearly 300 Taiwanese companies have invested approximately US$5.77 billion in India, generating close to 200,000 jobs. Major investors (e.g., Foxconn, Pegatron) are instrumental in India’s electronics manufacturing boom, often leveraging the government’s Production-Linked Incentive (PLI) Scheme.
High-Tech Collaboration: The partnership is centered on critical and emerging technologies:
Semiconductors: Joint projects are underway (e.g., PSMC and Tata Group) for fabrication plants, with India relying on Taiwan’s expertise in chip manufacturing and design.
AI and Green Technology: Cooperation is expanding into Artificial Intelligence (AI), electric vehicles (EVs), and green energy.
Strategic Context: The partnership aligns with Taiwan’s “New Southbound Policy” and India’s “Act East Policy”, serving as a critical mechanism for both nations to diversify supply chains away from China.
The FICCI report notes that the current economic relationship is marked by a widening trade imbalance (high imports from Taiwan). To address this, FICCI recommends that India focus on: (1) Targeted fiscal incentives for high-tech investments; (2) Joint R&D programs for AI and semiconductors; and (3) Diversification of India’s export base beyond chemicals and metals.
Relevant Question for Policy Stakeholders: What strategic policy measures must the Ministry of Commerce adopt to ensure that Taiwanese high-tech investment translates into greater technology transfer and indigenous value addition rather than just assembly operations?
Follow the full news here: Bilateral Trade Doubles in last 5 years: FICCI Report on India-Taiwan Economic Relations