Republic of China–India relations

The bilateral relations between India and the Republic of China (Taiwan) have improved since the 1990s despite both nations not maintaining official diplomatic relations.^[1][2] India recognizes only the People's Republic of China (in mainland China) and not the Republic of China's contention of being the legitimate government of territorial China - a conflict that emerged after the Chinese Civil War (1945–49). However, India's economic & Commercial links as well as people-to-people contacts with Taiwan have expanded in recent years.^[1]

Background

India recognised the People's Republic of China on April 1, 1950 and was supportive of its stand that it was the only state that could be recognised as "China" and that the island of Taiwan was a part of Chinese territory. India was one of the supporters of the People's Republic of China's bid to join the United Nations and replace the Republic of China to fill the seat for China in the U.N. Security Council.^[2] Despite the ups and downs in its relations with the People's Republic of China, including the border war of 1962, India has not changed its "One China" policy.

Development of bilateral relations

Even as India's own relations with People's Republic of China have developed progressively, in recent years, India has sought to gradually develop better commercial, cultural and scientific cooperation with Taiwan even while ruling out the possibility of establishing formal diplomatic relations ^[1] Taiwan has also viewed India's rising geopolitical standing as a potential counter-balance to China's dominance in the region.^[3] As a part of its "Look East" foreign policy, India has sought to cultivate extensive ties with Taiwan in trade and investment as well as developing cooperation in science & technology, environment issues and people-to-people exchanges. Both sides have aimed to develop ties to counteract Chinese rivalry with both nations.^[3] The India-Taipei Association ITA has been established in Taipei since 1995 to promote non-governmental interactions between India and Taiwan, and to facilitate business, tourism, scientific, cultural and people-to-people exchanges.^[1] The India-Taipei Association has also been authorised to provide all consular and passport services. The Taipei Economic & Cultural Centre in New Delhi is ITA's counterpart organization in India. In 2002, the two sides signed the Bilateral Investment Promotion & Protection Agreement and are discussing the possibility of entering into agreements related to Double Taxation Avoidance and ATA Carnet to facilitate participation in each others’ trade fairs.^[1][2] In 2007, Ma Ying-jeou, the leader of the Kuomintang, Taiwan's largest political party supportive of reunification, and a major candidate in the 2008 presidential elections made an unofficial visit to India.^[3] Recently India has supported Taiwans bid to join the UN as member-state.

Commercial ties

Both governments have launched efforts to significantly expand bilateral trade and investment, especially in the fields of information technology (IT), energy, telecommunications and electronics.^[2] India’s trade with Taiwan in the calendar year 2008 registered a total of US$ 5.34 billion, an increase of 9.5% as compared to 2007. In 2007, bilateral trade between the two sides had risen 80% to reach US$ 4.8 billion. In 2008, Indian exports to Taiwan declined year-on-year at a rate of -7.8%, to touch US$ 2.33 billion as compared to US$ 2.53 billion in 2007. Taiwanese exports to India in 2008 grew at a rate of 28.41% to reach US$ 3 billion. In 2008, India recorded a trade deficit of US$ 669 million with Taiwan, as against a trade surplus of US$ 159 million in year 2007 ^[4] Major Indian exports to Taiwan include Waste Oil and Naptha, Cereals, Cotton, Organic Chemicals, Copper, aluminum and Food Residues. Major Taiwanese exports to India include integrated circuits, machinery and other electronic products. India is also keen to attract Taiwanese investment particularly in hi-tech and labour intensive industries. More than 80 Taiwanese companies and entities have presence in India at present. Some of the companies include Hon Hai Precision Industry Co (FoxConn), Sanyang Corporation, Gigabyte Technologies, Continental Engineering, CTCI, Apache and Feng Tay (shoes), Wintek Corporation, Delta Electronics, D-Link, Meita Industrials etc.^[1] While bilateral trade has experienced significant growth in recent years, Taiwanese investment in India has been affected by cultural and linguistic barriers and reticence on part of Taiwanese businesses.^[2]

References