India could become one of the preferred destinations for Taiwanese tech manufacturers given Taiwan's vast requirement of skilled labour combined with a deepening engagement between the two countries, a report said on Tuesday.
India and Taiwan have been accelerating their engagement since the early 21st century. Taiwan's New Southbound Policy and Indian "Act East" initiative are working as the guiding stars to encourage and deepen the engagement between India and Taiwan, the report in the Commonwealth Magazine said.
The report highlighted India's Production Linked Incentive (PLI) schemes for manufacturers in various segments, particularly in semiconductor chip manufacturing.
India is encouraging more Taiwanese semiconductor firms to choose India as their manufacturing partner, the report said, adding, that India's proactive inbound-investment strategy has paid great attention to Taiwan.
Recently, the Indian government proposed Rs 76,000 crore (760 billion INR) as PLI for semiconductor design, manufacturing, and display fabrication (fab) units. Foxconn and Wistron, two major Taiwanese companies have been chosen for the PLI scheme in 2021, and it is expected that many more Taiwanese companies will have that eligibility to enjoy the PLI benefits, the report said.
With an increasing number of such investment and trading collaborations, India and Taiwan are planning to secure this ecosystem by signing an FTA, the report further said.
FTA will ensure some degree of liberalization in trade and manufacturing operations by eliminating maximum possible tariffs, trade barriers, quotas, and subsidies of both jurisdictions, the report said.
The report further cautioned that a thorough talk with company General Counsels and legal and Intellectual Property (IP) attorneys of both the countries will be crucial before the initiation of the FTA process given the significant difference between IP policies of the two countries, particularly in the pharmaceutical sector.
India has in recent times taken several bold initiatives to openly acknowledge its ties with Taiwan as Taipei's de facto embassy in New Delhi has also been given more public space.
Earlier this year in January, The State Bank of India has raised USD 300 million from the Taiwanese market through a maiden issue of Formosa bonds at a coupon rate of 2.49 per cent. The issuance attracted a wide range of investors, such as supranational agencies, asset managers, private bankers and financial institutions, as reported by Taipei Times.
( With inputs from ANI )
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