Changing fortunes across the Taiwan strait

India will be keenly watching how the new leadership in Taiwan would make its next move. Despite the DPP taking a more anti-Beijing and independent 'go south' trade and investment policy, New Delhi is wary of the risks involved in engaging the DPP effectively. In spite of calls in India to make Taiwan 'India's Israel' as a tit-for-tat for Beijing's [Images] pro-Pakistan policies, New Delhi is unwilling to take risks. The January 14 joint declaration between Prime Minister Manmohan Singh [Images] and China's Premier Wen Jiabao -- two days after the KMT's decisive victory in the legislative elections -- for the first time in many decades stated that India opposes any activity opposed to 'One China' principle. Such a long circuitous diplomatic formulation indicated to a cautious but 'politically correct' approach towards Taiwan on the part of South Block.

On the other hand, despite its widely known pro-China reunification policies, the KMT's stock appears to be rising in Delhi. Ma Ying-jeou visited Delhi last year and promised more business contacts with India. Taiwanese investments today are much more than Chinese investments, although India-Taiwan bilateral trade of nearly $4 billion is far less than the $40 billion in trade figures for India-China.

(Editor: Emily)