China may be the global electronics factory, but it is neighbouring Taiwan that India is increasingly looking at to drive its ‘Make in India’ initiative.
A team led by secretary electronics and information technology RS Sharma went to Taiwan in March, and met a few major companies. The delegation will soon undertake a follow-up visit.
“A number of proposals have been given final shape. We hope to firm up a few contracts with Taiwanese companies for setting up telecom and electronic manufacturing units in India,” a top official in communications ministry told HT.
India currently imports electronic products worth $100 billion annually, setting of concerns among policymakers that the digital inclusion plans may have to be aided entirely by imported devices. Last year, the government launched the plan to set up clusters for manufacturing of electronics goods with an incentive scheme: the government would add Rs 25 to every Rs 100 that an electronic producer invested in these clusters.
Taiwan has also expressed interest in setting up units in the country.
“India is strong in information technology (IT). Taiwan is strong in hardware production. We can collaborate in manufacturing of the best hardware and software platforms,” Chung Kwang Tien, representative of the Taipei Economic and Cultural Centre in India said recently.
However, the cost of production of most electronic goods in India is at least 8 to 10% higher than in other countries of South East Asia and China.
“A team from our ministry is closely working with commerce, home and finance ministry officials to address these issues. It will not be a hindrance except for security, and Taiwanese companies are not a threat,” the communications ministry official added.
India and Taiwan have already signed various trade facilitation agreements such as bilateral investment protection agreement (BIPA), double-taxation avoidance agreement and common market access agreement.