Taiwanese Enterprises Rushing to Invest in India

Taipei, May 16, 2006 (CENS)--Attracted by the huge potential of the emerging Indian market, growing numbers of Taiwanese firms are actively preparing to join the global craze for investments in India.

On May 15, the Institute for Information Industry (III), a semi-official organization, inaugurated its first overseas R&D institution, dubbed ''Offshore Development Center, or IDC), in Chennai of India. The first-phase facilities of the factory of Hon Hai Precision, Taiwan' s largest manufacturer, are slated for operation in June. In addition, some 13 to 15 other Taiwanese enterprises are actively studying the feasibility of investing in India, including Pou Chen Group, Taiwan' s foremost footwear, Feng Tai

Enterprise, another major footwear maker in Taiwan, TECO, a leading maker of electrical machinery, and President Enterprises Group, Taiwan' s largest foodstuff maker.

As Taiwan is targeting at India in its ''southward policy,'' India also has its ''eastward policy.'' Huang Kuo-chun, deputy chief executive officer of III, pointed out that the Indian government has targeted to expand the scale of its information software industry to US$200 billion by 2010 and the Indian premier has designated Taiwan and South Korea as the two best partners for the project.

As a result, the III set up its IDC in order to cash in on the huge business opportunities connected with the project. ''We can also solicit quality Indian software talents nearby,'' remarked Huang Kuo-chun.

On May 14, Shih Yien-hsiang, vice minister of economic affairs, led a 140-member Taiwanese economic and trade delegation to visit the IDC of III and the factory of Hon Hai in Chennai as part of their agenda to promote Taiwan-India economic and trade links.

The first phase facilities of Hon Hai were rebuilt from a factory originally belonged to Panasonic. With a projected work force of 500 to 700, the Chennai factory of Hon Hai has dispatched some of its Indian cadres to receive training at Hon Hai' s Chinese factories. Shih Yien-hsiang revealed that due to the smooth progress of the factory' s construction works, the first-phase facilities will start to operate in June.

M. Velmurugan, director of foreign investments of the Tamil Nadu state government of India, pointed that many Taiwanese firms are following the step of Hon Hai to invest in Chennai. ''I alone have received 13 to 15 prospective Taiwanese investors, including big and small enterprises,'' revealed Velmurugan.

Theodore M. H. Huang, chairman of TECO and vice chairman of Taiwan-India Association, reported after visiting many places with the delegation, he has identified many investment opportunities for his company, including motor, information software, and infrastructure.

Chen Chi-cheng, chairman of a textile company, noted that ''Taiwanese businesses often follow the steps of their clients in their investment strategies'' Hon Hai has followed the lead of Nokia to invest in Chennai. Pou Chen and Feng Tai are studying to invest in India, mainly out of the request of Adidas and other major clients. Once those big Taiwanese enterprises come to India, their supporting factories will follow suit.

Shih Yien-hsiang predicted that although accumulated Taiwanese investments in India amounted to only US$17 million as of the end of 2005, following the investments of Hong Hai and III in India, Taiwanese investments will grow 10-fold in the next several years.