With an eye on carving out a larger share of the Indian tech products and precision tools market, Taiwan is looking to fast-track discussions on a trade deal with India.
James C F Huang, chairman of the Taiwan External Trade Development Council (TAITRA), said, on the sidelines of the Taiwan Expo 2019 told media representatives that discussion is on and TAITRA expect things to move quickly after the bilateral investment promotion agreement was signed last year. He also informed that Taiwan is looking forward to the prospects of a free trade agreement (FTA).
Walter M S Yeh, president and chief executive officer of TAITRA, said that Taiwan has few FTAs due to political difficulties. As a result, Taiwanese products have to be more competitive and of better quality, as they face high import duties in most countries.
However, the nation is systematically building up trade partnerships, currently with seven FTAs and three preferential trading agreements, one of which is with manufacturing and consumer behemoth China, reported Business Standard in a recent report.
Although Taiwanese companies specializing in heavy machinery and engineering tools have been listed, the original equipment manufacturers of electronic equipment are also pouring in. New Delhi hopes that these key components will be gradually produced in China or transported from other countries rather than imported from China.
One of the largest, Foxconn assembled electronic components for Apple smartphones in six locations and plans to increase the number of facilities operating in India and increase production.
The country’s bilateral trade with India grew almost 10 per cent in the first 11 months of 2018-19 to $6.64 billion, with $2.45 billion worth of exports to the island nation. While total trade has grown in double-digit figures for the last three years, imports remain twice as hefty.
In addition, many other Taiwanese companies that manufacture network equipment, bicycles, auto parts and automotive electronics are returning from China, where labor costs are rising. Subsequently, although the Taiwan government launched the “Welcome to Come Back” program, the first two years of free rent, preferential bank loans and tax advice and other incentives, but a stricter standard system has already dampened their mood.
Therefore, a cross section of the manufacturing industry looks at India’s transfer facilities. Taipei City hopes to join the Trans-Pacific Partnership Comprehensive Progress Agreement, including large economies such as Australia, Canada, Japan and Singapore, to accelerate this sentiment.