For all those wringing their hands in despair over China reaching out to all of India's immediate neighbors and even the distant ones, the situation for India is not as bleak.

To China, Pakistan is an iron-friend; Nepal a new-found friend; Bangladesh on way to being a friend; and Afghanistan is being tempted with the notorious debt-laden Belt and Road Initiative (BRI) money. All with a view to forming a China-South Asia network against India.

Meanwhile India too is busy playing tit-for-tat and upping its weak Chinese game. It has chosen the right player to partner with in China's own backyard, and that player is Taiwan.

India is paying considerable attention to Taiwan, a bugbear to China, and is steadily upgrading political and economic ties with the small but powerful country. Though the outreach began a few years back, it has picked up pace over the past few months with visible signs emerging in a rather dull India-Taiwan mosaic. Any relationship with the island nation in the East China Sea will come at a cost to China—recognition, trade and investment as well as political relations.

Politics and leadership

At the political level, two BJP Indian Members of Parliament, Meenakshi Lekhi and Rahul Kaswan, attended the online swearing-in ceremony of Taiwanese President Tsai Ing-wen in May this year. This is in stark contrast to the same situation in 2016 when Indian Prime Minister Narendra Modi had decided, after considerable deliberations, not to have Indian representation at her first swearing in ceremony to avoid offending the Chinese. The two MPs in a video message, which was played at President Tsai’s swearing in, said: “Both India and Taiwan are democratic countries, bonded by shared values of freedom, democracy and respect for human rights.

Over the past years, India and Taiwan have enhanced bilateral relations enormously in wide-ranging areas, especially trade, investment and people to people exchanges.” A political outreach like this signifies approval at the highest levels. India is opening the door to Taiwan surely but cautiously. It even commented on the passing away of the country’s former president Dr Lee Teng-hui, who is credited with ushering in democracy in the island country much to Beijing’s annoyance. In a statement, the India-Taipei Association (ITA), India’s mission in Taiwan to promote business relations said: “India Taipei Association joins the people of Taiwan in mourning the passing of Taiwan’s ‘Mr. Democracy’, Dr Lee Teng-hui.” In the face of Chinese hostility on Indian borders, it is a noteworthy welcome departure by India.

The art of diplomacy

Out of deference to Chinese sensitivities, India has not established diplomatic relations with Taiwan like most other countries but has been working through the ITA. However, with China proving itself consistently hostile to Indian interests related to terrorism and unflinching support for Pakistan, unreliable in trade dealings with an ever-increasing trade imbalance and now a hostile incursion into the Indian border on Ladakh, India is changing its policy.

There have been consistent calls from within the country by strategists and thinkers to dump the One China Policy that sees Taiwan as a part of China. New Delhi has appointed Gourangalal Das as its new envoy to Taipei. The appointment is seen as significant as he is an experienced diplomat who was earlier posted to Beijing and has done an important stint in Washington.

In Delhi, Das has been working on the Quad that brings India, USA, Japan and Australia together—an important assignment in today’s China-stricken world. Das' appointment is expected to considerably help cement Delhi-Taipei relations. Interestingly, Ambassador Tien Chung-kwang, who was Representative of the Taipei Economic and Cultural Centre (TECC) in Delhi till recently is now Taiwan’s Deputy Foreign Minister. This is probably an indicator that Taipei is looking forward to elevating trade and business ties between the two democracies. For India, Tien is a contact who will be of immense help as he is already well-versed with the Indian business ecosystem considering he spent seven years in Delhi.

Business and trade

There are increasing calls within the country to strengthen not just trade and economic ties with Taiwan but to also promote people-to-people and cultural ties. Some of this is catalyzing as many Taiwanese companies which had been working out of China are now looking for greener pastures. India happens to be one of those pastures.

The much sought-after coronavirus exodus of companies from China is benefitting India though slowly. Trade between the two countries has been increasing steadily. Pegatron, a Taiwanese company, assembling products for Apple plans to relocate its business from China to India. If India can attract more technology and IT companies from Taiwan, it can deal China a double blow—attract foreign investment in India at a cost to China and also reduce India’s dependency on the Middle Kingdom for electronic products.

Even as the final word on changes in global investment and business environment are not final owing to the spread of the deadly Covid from China, trade has shot up from $1 billion in 2000 to $7.5 billion in 2019. It is a steady balanced rise that does not upset India. Taiwanese investment is steadily rising and so are companies that are coming to India. Fairly well-known names like Wistron and Foxconn plan to invest heavily in the country as business relations between the two countries are built by a plethora of government agencies and industry chambers.

Conclusion

China has developed the art of making enemies. Since the advent of coronavirus from Wuhan late last year, and the aggressive misinformation campaign surrounding it, China has begun to churn out enemies at a faster pace. It's closest neighbors in the East China Sea—Japan, South Korea and Taiwan—all advanced and powerful democracies are averse to China’s expansionist plans. It is an almost similar situation in the South China Sea—Vietnam, Malaysia, Indonesia and Brunei—where China has antagonized all its neighbors owing to its territory grabbing tactics.

If China is making friends in the South Asian neighborhood with a view to undercutting India, the latter too is making friends in the Chinese backyard. While China goes about its work with much publicity and boisterousness, India plays it quiet. The question now is whether India will turn out to be the rival that China has always considered India to be, or will India play second fiddle to China courtesy our decades-old warped thinking driven by an uncertain leadership.