Mains Articles

India-Taiwan Bilateral Relations: Challenges and Prospects [Mains Article]

Even as India launches its “Act East” policy and ambitious initiatives such as “Make in India”, it is time to highlight the importance of Taiwan for an emerging India and bring the India-Taiwan relationship into focus.
By IT's Mains Articles Team
September 22, 2017


  • What is Taiwan’s Status in the World?
  • Why is Taiwan Important?
  • Taiwan-China Relations
  • What is One-China Policy?
  • Taiwan-US Relations
  • India-Taiwan Relations
  • Significance of Taiwan for India
  • India’s cultural diplomacy
  • Challenges
  • What India should do? / Prospects of India-Taiwan Bilateral Relations
  • Way ahead

India-Taiwan Bilateral Relations: Challenges and Prospects

For IASToppers Mains Articles Archive, Click Here

GS (M) Paper-2: “India and its neighbourhood- relations.”


What is Taiwan’s Status in the World?

  • Taiwan officially the Republic of China (ROC), is a state in East Asia.
  • Its neighbours include China (officially the People’s Republic of China, PRC) to the west, Japan to the northeast, and the Philippines to the south.
  • Taiwan is the most populous state that is not a member of the United Nations and the largest economy outside the UN.


Why is Taiwan Important? 

Strategic lynchpin

  • In the global strategic scenario of the 21st century, China’s rise has made the Asia Pacific region the most dynamic part of Asia, and Beijing seems eager to challenge the erstwhile preeminent US role in this region. In these contexts, Taiwan could be viewed as the strategic lynchpin of the Asia Pacific region.

Economic powers

  • Taiwan is Asia’s 5th and the world’s 16th-largest economy. It has the world’s 4th-largest foreign reserves, ranks 15th amongst the world trading nations, is the world’s 21st-largest foreign investor; is the world’s 3rd most attractive destination for foreign investment; and, being a global leader in chip manufacture and the second-largest manufacturer of IT hardware, etc., Taiwan is a ‘hi-tech’ super power.


Significant for China

  • Given Taiwan’s economic, financial and technological strengths and its location in the strategic heart of the Asia Pacific region, if China and Taiwan were reunified, China would take a quantum leap forward economically, financially, technologically, politically, militarily and strategically. This would dramatically narrow the strategically vital gap in all these spheres between China and the US.
  • An enormous amount of globally significant trade passes through the Taiwan Strait and the South China Sea – which is also believed to contain significant quantities of oil and gas.
  • Taiwan is in actual physical possession of Itu Aba, the largest island in the Spratlys chain in South China Sea. Therefore, Taiwan’s reunification with China would enable China to take control of the South China Sea, ensconce itself within ASEAN’s belly, have a vise-like grip over the vitally important sea lanes to Japan, Korea and the Pacific, and make China a maritime power in the Pacific Ocean – to which it has no direct access at present.
  • In the light of these facts, Taiwan’s reunification with China would dramatically transform the strategic geography of the Asia Pacific region. It will enable China to acquire a virtually unchallengeable strategic stranglehold over the entire region and for all practical purposes virtually eliminate all potential future strategic choices of regional countries. US security and strategic leverage in the region would also be gravely jeopardised if not crippled.

For all these compelling reasons, Taiwan’s continued separate existence is of vital importance to the entire world to prevent China’s acquiring of virtually unchallengeable hegemony over the Asia Pacific region.

Taiwan-China Relations

  • Taiwan, home to twenty-three million people, is an island off the southern coast of China that has been governed independently from mainland China since 1949.
  • The People’s Republic of China (PRC) views the island as a province, while in Taiwan—a territory with its own democratically elected government—leading political voices have differing views on the island’s status and relations with the mainland.
  • Some observe the principle that there is “one China” comprising the island and the mainland, but in their eyes this is the Republic of China (ROC) based in Taipei; others advocate for a de jure independent Taiwan.
  • China and Taiwan maintain a fragile relationship, which has improved during the past seven years but is periodically tested.

India-Taiwan Bilateral Relations: Challenges and Prospects

What is One-China Policy?

  • It is the diplomatic acknowledgement of China’s position that there is only one Chinese government.
  • Under the policy, any country that wants diplomatic relations with mainland China must break official ties with Taipei that it considers a ‘breakaway province.’

Taiwan-US Relations


US-China 1979 Joint Communique

  • Taiwan’s existence separate from China from 1949 until today has been possible entirely and only because US policy has ensured this – despite a huge qualitative change in US-Taiwan relations after the US-China 1979 Joint Communique.
  • The Joint Communique said that the United States of America recognizes the Government of the People’s Republic of China as the sole legal Government of China…. Within this context, the people of the United States will maintain cultural, commercial, and other unofficial relations with the people of Taiwan.
  • The Communique also said that “The Government of the United States of America acknowledges the Chinese position that there is but one China and Taiwan is part of China.”
  • It is worth noting however, that the word “China” is used and not the phrase “People’s Republic of China” thus leaving open the issue of Taiwan’s future status.

US government’s Taiwan Relations Act (TRA)

  • Post 1979, US-Taiwan relations have been governed by the TRA, which is an utterly unique law.
  • It is a domestic law which, however, compels the US president to remain mindful of ensuring Taiwan’s security.
  • The US has remained a major arms supplier to Taiwan. The US-Taiwan relationship, covering the entire spectrum – economic, political, cultural, military, people to people, etc. – is very robust.
  • China has remained extremely unhappy about the TRA and the continued US arms sales to Taiwan.
  • However, it is also important to note that the US does not support Taiwan’s independence.

India-Taiwan Relations

India-Taiwan Bilateral Relations: Challenges and Prospects

  • First of all, India and Taiwan share similar values and there are no serious disputes between the two countries.
  • India was the second non-Communist country to recognise the new People’s Republic of China, and since then, has been one of the strongest and particularly vocal supporters of the ‘One China’ concept as interpreted by the PRC.
  • The areas of cooperation between India and Taiwan are bound to be limited so long as their political relations remain negligible.
  • Since 1995, India-Taiwan relations have been improving gradually. Between 1995 and 2014, the bilateral trade turnover has grown manifold from just $934 million to $5.91 billion.
  • Both sides have also expanded educational exchanges after a mutual degree recognition agreement in higher education was signed in 2010.
  • In the field of science and technology, there are more than thirty ongoing government-funded joint research projects.
  • In August 2015, the Taiwan-based Foxconn, one of the largest hardware manufacturers in the world, announced an investment of $5 billion in India.
  • In order to further promote people-to-people exchanges between the two countries, in February 2010, Taiwan decided to grant visa-free entry to the Indians who hold valid visas or permanent residences for US, UK, Canada, Japan, Schengen Convention countries, Australia or New Zealand. On the other hand, India has recently added Taiwan to its e-tourist visa programme to simplify the visa application for Taiwanese visitors.

Significance of Taiwan for India:

  • India-Taiwan relations are significant to India’s security interests.
  • Taiwan is known for hardware manufacturing while India has an established software industry; some even refer ‘India and Taiwan’ as IT to indicate the fact that both countries complement each other.
  • Taiwan has for long been a world leader in high-tech hardware manufacturing, and is able to contribute much to the “Make in India”, “Digital India” and “Smart Cities” campaigns. Apparently, India is yet to explore Taiwan’s vast technological potential.
  • Taiwan’s agro-technology and food processing technology will also be very beneficial for India’s agriculture sector.

India’s cultural diplomacy

While India is determined to implement the “Act East Policy” to bolster its ties with the countries in the region, cultural exchanges can be an important part of its strategy.

iastoppers India’s cultural diplomacy

  • The present Indian government has injected cultural diplomacy into India’s international engagement, using soft power as a foreign policy tool to improve its global image and expand the influence.
  • India’s Ministry of Culture has launched the Mausam project to provide a platform to strengthen cultural ties between India and the Indian Ocean “world”.
  • India has also consistently emphasized the value of democracy and plans to use Buddhism as a cultural diplomacy tool.
  • The Indian government is working with the World Bank to develop a Buddhist tourist circuit in India.


  • Constrained by its commitment to Beijing’s “One China” policy, New Delhi finds it difficult to realise the potential of its bilateral relationship with Taiwan.
  • Despite the fact that the economic interests of the two nations dovetail well, the economic exchange is still relatively insignificant. Taiwan’s share of trade with India is around one per cent of its global trade.
  • Taiwanese direct investment into India totalled $66.46 million between 2004 and 2014, far less than its investment in most of the Southeast countries. Over the past decade, Taiwanese firms have invested more in China, Vietnam, Thailand, Malaysia, the Philippines, and Cambodia than India.

What India should do? / Prospects of India-Taiwan Bilateral Relations:

  • On the strategic security front, both India and Taiwan have serious and deep concerns about China’s growing assertiveness in the region. The China factor can become a medium to bring the strategic communities in New Delhi and Taipei closer.
  • It is not to say that India and Taiwan should forge a military alliance against China, which is too proactive and unrealistic. Taiwan does not expect India to be some kind of a military ally but believes that India’s presence in the region will provide some sort of balance. As a result, regular information exchange between the militaries and the intelligence agencies of Taiwan and India would benefit both.
  • Taiwan has invested heavily on China studies. India should take advantage of this fact. Therefore, Taiwan is able to help more Indians understand what the Chinese are saying and thinking by providing Chinese language training.
  • India should deploy its military attaché to its office in Taipei as part of plans to strengthen defence cooperation.
  • More interactions and collaboration between strategic studies communities are needed.
  • For many years Taiwan has been focusing on China’s market and has now attempted to diversify its investments away from China.
  • Equipped with Taiwan’s technology and experiences, India can modernise its capacity as nearly 40 per cent of its fruits and vegetables go waste after harvesting. Such collaboration could seriously change the landscape of India’s rural areas and agriculture.
  • India has abundant natural bamboo resources while Taiwan owns the world-class bamboo charcoal technology. With this sort of technology, India can make use of its bamboo resources to produce high value-added goods.
  • Both sides need to work out plans to pep up trade volume and increase economic cooperation between the two nations so as to take advantage of the joint strength.
  • India’s cultural diplomacy can bring rationality to India-Taiwan relations. There is religious intimacy between the two societies as most Taiwanese are Buddhists.
  • Both countries are free democracies with a strong civil society. Though few Taiwanese know India very well, there are an increasing number of India-related elements in Taiwan, ranging from Tagore’s poetry and Darjeeling tea to herbal soaps.
  • In the absence of formal diplomatic relations, there is also a need to conduct friendly sister-city activities to promote engagement and mutual understanding.
  • Another obvious area of cooperation with Taiwan is educational exchange. Taiwan is host to 160 accredited universities that accept hundreds of thousands of international students every year. Degrees earned in Taiwan are recognised worldwide.

Way ahead:

  • It is understandable that Taiwan is not the priority of India’s foreign policy as the present government is interested in big power diplomacy. But India should not neglect Taiwan at the cost of its national interests.
  • Even as India launches its “Act East” policy and ambitious initiatives such as “Make in India”, it is time to highlight the importance of Taiwan for an emerging India and bring the India-Taiwan relationship into focus.
  • As India becomes more and more important in Taiwan’s policy, it is time for Indian policy makers to review India’s Taiwan policy and fashion a new approach.
  • Greater cooperation between India and Taiwan could prove critical in helping New Delhi and Taipei achieve their economic goals at home and their strategic aims in the region.
  • It is time to acknowledge the importance of India-Taiwan relations. India should consider its own interests not the third party’s ones, when it thinks of developing relations with Taiwan or other countries.
[Ref: IPCS, Indian Defence Review]


Latest Posts Mains Articles


My Favourite Articles

  • Your favorites will be here.

Calendar Archive

October 2019
« Sep