Narendra Modi’s win to boost business ties with Taiwan
If BJP’s prime ministerial candidate Narendra Modi is voted to power, it’s not just China that’s optimistic of a bigger economic presence in India.
After the elections get over in May, Taiwan, which is still considered by Beijing as part of China, is likewise anxious of the poll outcome and is also hoping of its proposed mega steel plant in Gujarat to have some concessions so that they can start with their production as per the new government.
In Gujarat the island nation of Taiwan has been quietly expanding its presence and share excellent rapport with Modi, of which only some of us are aware. In reality Taiwan has been invited as the BJP General Secretary in the past by the the Gujarat CM, and he even hosted the biggest-ever business delegation from that country in 2011.
China Steel Corporation (CSC), Taiwan’s biggest steel maker, in 2012 has signed an agreement with the Gujarat government to set up an electrical steel plant at a cost of Rs6, 000-crore, on a 145-acre plot at Dahej.
As per Chung-Kwang Tien, Ambassador of Taiwan to India, This year it is expected to begin with the manufacturing exercise but due to non presence of Free Trade Agreement (FTA) between the two countries, it is expected that the cost of manufactured products will go up. The Ambassador added the Free Trade Pact will help decrease the duty on materials sourced for the plant from abroad.
It will be the second biggest Taiwanese investment in this South Asian country, and the plant by CSC will match the magnitude of the planned plant by South Korean giant Posco in Odisha.
CSC is the largest integrated steel maker in Taiwan and the 25th largest steel producer globally.
Last year, the two countries had finished a joint feasibility study for the FTA.Though; due to elections in India the FTA could not be signed. Taiwan pins hope on Narendra Modi’s win to boost business ties with India, and sign the FTA at the earliest that would further encourage Taiwanese investments in India.
As a section of the Indian officials felt that the FTA with few other countries has not yielded the necessary results, this has led to a delay in signing of the Free Trade Agreement.
Modi had assured to set up a special Taiwan Industrial Park near Ahmedabad, but it is not known widely.
Gujarat is fascinated in Taiwanese investments in sectors such as chemicals, petrochemicals, besides electronics, telecommunications, biotechnology and genomics, machine tools, clean and green energy, solar power and solar power equipment, renewable energy and shipbuilding.
Though, Modi’s challenge will be to balance India’s relations with China and Taiwan, if he becomes the PM, as China too has a strong economic presence in Gujarat.
Both of the countries have signed Bilateral Investment Protection Agreement and Double Taxation Avoidance Agreement.
Source: Economic Times
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