India’s decision on August 5 to revoke Kashmir’s special status has led to heightened tensions with Pakistan and China in an already volatile geopolitical arena. After the Indian government downgraded Jammu and Kashmir’s statehood to “union territories” to be ruled by India’s central government, China opposed the Indian move, calling it “unacceptable” and an attempt to “undermine China’s territorial sovereignty.” Yet, China’s position on India’s latest Kashmir move could be tempered by its realization that India could cause trouble for Beijing on other fronts such as Taiwan. From Beijing’s perspective, India has many leverage points from which it can seek to undermine Chinese national interests, ranging from the South China Sea, Tibet, and Taiwan, as well as cozying up to the United States and Japan under the US Indo-Pacific Strategy.
Chinese analysts believe that the government of Indian Prime Minister Narendra Modi has been advised by Indian influencers to utilize the “Taiwan card” to exert pressure on Beijing. Chinese scholars have expressed their suspicion that India has used the Taiwan issue to hit back at Beijing for its USD $62-billion China-Pakistan Economic Corridor (CPEC) with India’s archenemy Pakistan. A Global Times editorial states, “As the corridor passes through the disputed Kashmir, some Indian strategists have advised the Modi government to play the Taiwan card, using the commitment of the ‘One-China’ policy as leverage in exchange for China’s endorsement of ‘One India’.” It warned, “By challenging China over the Taiwan question, India is playing with fire.” Playing the “Taiwan card” would be extremely detrimental to Sino-Indian relations, another Global Times editorial argued.
Since 2010, the Indian government has refused to officially endorse the “One-China Principle”—not seemingly because it supports changing Taiwan’s legal status but rather because it perceives the lack of Chinese respect for India’s concerns over disputed territories with Pakistan and China. The Indian government last endorsed the “One-China Principle” in a 2008 joint statement. By contrast, the 2010 joint statement between Chinese Premier Wen Jiabao and Indian Prime Minister Manmohan Singh did not mention India’s affirmation of its “One-China” policy. New Delhi apparently withdrew its support after China issued stapled Chinese visas, instead of regular visas, to Jammu and Kashmir residents, angering the Indian government. In 2014, External Affairs Minister Sushma Swaraj said, ahead of Chinese President Xi Jinping’s (習近平) visit to India, “For India to agree to a ‘One-China’ policy, China should reaffirm a ‘One-India’ policy.” Indians have argued that if Beijing seeks New Delhi’s backing of Chinese claims over Tibet and Taiwan under the “One-China” framework, then the Chinese government also needs to reciprocate its support of “One India” and respect Indian sovereignty, such as by stopping CPEC projects in Pakistan-administered Kashmir. Beijing also does not accept the Indian-administered, northeastern state of Arunachal Pradesh as Indian territory, instead claiming it as part of southern Tibet. Meanwhile, India claims the Chinese-administered Aksai Chin, which borders Jammu and Kashmir.
Over the years, Beijing has become more sensitive about political exchanges between its two rivals, New Delhi and Taipei. After a three-member Taiwanese parliamentary delegation led by Democratic Progressive Party (DPP) legislator Kuan Bi-ling (管碧玲), who chairs the Taiwan-India Parliamentary Friendship Association, visited India in February 2017, the Chinese government protested and urged New Delhi to adhere to the “One-China Principle.” The Indian government brushed off the Chinese protests, stating, “There is nothing new or unusual about such visits, and political meanings should not be read into them.” Such informal visits by Taiwanese groups have also been taken to China, said India’s Ministry of External Affairs. China’s Foreign Ministry also criticized a plan to upgrade Taiwan’s representative office in New Delhi that was discussed during the Taiwanese delegation’s visit. “We are also opposed to the establishment of any official institutions,” said foreign ministry spokesperson Geng Shuang. China has urged the Indian government to stick to the “One-China Principle” on numerous occasions and said that doing so would greatly help enhance mutual trust between the two countries.
Indian analysts have debated the merits of hewing so strictly to Beijing’s hardline approach of restricting major forms of engagement with Taiwan that has caused New Delhi to traditionally neglect its relations with the island. C. Raja Mohan, director of the Institute of South Asian Studies at the National University of Singapore, wrote, “India […] has too many self-imposed constraints on its Taiwan policy. It is now time to lift many of them.” Mohan urges the Indian government to “replace its current incrementalism with a more ambitious policy” towards Taipei based on geopolitical and geoeconomic reasons. He argues Taiwan “holds the key to the geopolitics of East Asia,” which will, in turn, impact India’s “Act East Policy” and its role in the Indo-Pacific region. Taiwan could also potentially help Modi’s economic agenda of boosting manufacturing and creating new jobs in India, he said.
In view of Taiwan’s economic appeal to India, Chinese commentators have posited that India can reap more economic gains by joining the Belt and Road Initiative (BRI, also known as “One Belt, One Road”) than from Taiwan’s economic investments in the South Asian country—which President Tsai Ing-wen’s (蔡英文) administration is pursuing through the “New Southbound Policy” (新南向政策). A Global Times editorial acknowledged how growing Taiwanese investment in India is “important to Modi’s ‘Made in India’ campaign,” but said that “the best way for India to develop is by participating in the Belt and Road Initiative and attract more investments from the mainland.” The Chinese are also wary that President Tsai is “exploiting India’s vigilance and strategic suspicions against China” and urged Indians to be cautious of “Tsai’s political intentions.” The Chinese government has repeatedly invited India to participate in Xi’s grand connectivity plan, but India has refused to officially endorse the BRI, frustrating Chinese regional ambitions. Amid heightened cross-Strait tensions, China wants India to choose greater economic cooperation with Beijing in lieu of closer ties with Taipei.
However, the dynamics in the China-Taiwan-India triangular relationship do not revolve around India’s choice between China and Taiwan; Taiwan also has to decide on economic and geopolitical pathways towards India and/or China. As Taipei seeks to lessen its economic dependence on China, it is looking towards India, which also boasts a huge domestic market, as an alternate route for Taiwanese goods and foreign direct investment. The underlying rationale is that Taiwanese companies can utilize India to diversify its trade and investment portfolio and avoid the geoeconomic risks associated with hefty investments in China, particularly as the US-China trade war is yet unresolved and will continue into the near future.
Indeed, Taiwan and India share economic synergies between the former’s “New Southbound Policy” and the latter’s “Act East Policy” and “Made in India” initiative. Taiwanese businesses are stepping up their investments in India, while Taiwan’s technical know-how and potential to create jobs in India appeal to the Indian government. As of December 2017, more than 100 Taiwanese companies invested USD $1.5 billion in India, in sectors including information technology, shipping, shoe manufacturing, and financial industries. The Taiwan External Trade Development Council (TAITRA) said Taiwan is considering creating industrial parks in India as part of the “Make in India” Initiative. Additional areas of Taiwan-India collaboration include information technology, petrochemicals, food processing, electronic manufacturing, and electric vehicles. Taiwan’s expertise in information and communication technology, artificial intelligence, hardware manufacturing, and other sectors could play a positive role in the Indian government’s “Digital India,” “Skill India,” and “Smart Cities” initiatives, said Taiwan’s Representative to India Chung-kwang Tien (田中光).
As Taiwan seeks to strengthen economic, political, and people-to-people ties with South Asian countries, India, as a rising economic and regional power, democratic country, and important player in a free and open Indo-Pacific region, is a natural partner for Taiwan. Both sides have much to gain from enhanced economic and trade ties. After signing a bilateral investment agreement in 2002 and renewing it in 2018, Taiwan’s government is eager to discuss a possible Free Trade Agreement with India. As it pursues economic and other ties with India, Taipei needs to carefully navigate the Sino-Indian rivalry without becoming a card to be played by either Beijing or New Delhi. In a similar fashion, Taipei should also weigh the costs and benefits of using the India card to unnerve Beijing.
The main point: Taiwan remains one of several sticking points in Sino-Indian relations, particularly as India has refused to affirm the “One-China” policy and Taiwan and India have forged closer economic ties. Taipei should carefully navigate South Asian geopolitics and avoid becoming a pawn in the geopolitical game between the two rising Asian powers.