In the last few years, Taiwan’s overseas investment has been heavily concentrated in mainland China. As a result, Taiwan’s economic dependence on mainland China has reached an excessively high level. To reduce the risk resulting from having their overseas investment concentrated too heavily in a single market, Taiwanese companies should be looking for ways to diversify their overseas investment strategy. This study examines the current state of Taiwanese investment in Southeast Asia and India, the problems that Taiwanese companies have encountered in these markets, areas where Taiwanese firms can build competitive advantage in Southeast Asia and India, and the outlook for the future.
The study begins with a review of the literature, and an overview of the development of Taiwanese investment in Southeast Asia and India, along with the problems that Taiwanese companies have had to deal with in these markets. While analyzing the pattern of Taiwanese investment in Southeast Asia and India, the study also considers the economic development strategy choices open to India and the Southeast Asian nations in the future. Besides collecting and collating relevant data, the authors also conducted in-depth interviews with leading scholars in related fields, to gain a clearer understanding of the concrete measures that could be used to encourage Taiwanese companies to invest in Southeast Asia and in India, and of the impact that investment in these regions would have on the Taiwanese economy as a whole. In addition, a conference was held, at which academics and experts, business leaders and government officials were brought together to discuss the opportunities for Taiwanese investment in Southeast Asia and India. Visits were made to both India and Southeast Asia to examine the investment environment and the operations of Taiwanese companies that have already invested in these regions at first hand, to ensure that the information on which the study is based was as detailed and up-to-date as possible. The study also seeks to forecast the likely trends in overseas investment by Taiwanese companies in the future. It considers the advantages that Taiwanese firms can secure by investing in Southeast Asia or India, and the niche markets that can be developed there. Suggestions are put forward as to the ancillary measures that the Taiwanese government could introduce to promote the development of the Southeast Asian and Indian markets by Taiwanese business enterprises. In the case of Southeast Asia, possible measures would include: promoting exchange and visits between trade officials, making sure that Taiwanese companies have access to accurate, up-to-date information on investment opportunities in Southeast Asia, promotion of exchange between Taiwanese and Southeast Asian industry, helping Taiwanese businesspeople to overcome the language barrier when investing in Southeast Asia, providing assistance to enable the children of Taiwanese businesspeople operating in Southeast Asia to complete their education in Taiwan, strengthening the range of supporting services available to Taiwanese enterprises, actively promoting the establishment of free trade agreements between Taiwan and the Southeast Asian nations, organizing delegations of Taiwanese businesspeople to explore investment opportunities in Southeast Asia, etc. In the case of India, measures would include: the provision of up-to-date investment and market development information, promotion of collaboration and exchange between Taiwanese and Indian industry associations, assisting with the recruitment of Indian engineers to work in the hi-tech sector in Taiwan, expansion of the Taiwan Cell (which providing consulting services for Taiwanese firms interested in investing in India), promoting research on issues relating to the Indian economy, providing financing assistance and other investment incentives, promoting the establishment of a “Taiwanese industrial park” in India to facilitate industry cluster development, helping Taiwanese companies operating in India to localize their operations, encouraging them to develop branded manufacturing and to expand their marketing channels, and establishing an extensive support network to provide Taiwanese companies in India with the assistance they need. Adoption of these measures would make a substantial contribution towards helping Taiwanese enterprises to develop the Southeast Asian and Indian markets, both of which offer significant growth potential, thereby helping Taiwanese firms to strengthen the overall effectiveness of their overseas investment activity.