India-Japan-Taiwan Trialogue:
Economic and Trade Cooperation
Shyam Sunder, Yale University
Taiwan Thinktank, Taipei, Taiwan
November 11-13, 2004
Overview
• Importance of economic and trade
cooperation
• Why there has been so little economic
exchange so far?
• What can be done to remedy this situation
• What could the future be?
Importance of Economic
Cooperation
• Economists may not agree with one another on much
• They do agree on one thing: trade and cooperation
benefits everyone
• Taiwan has made huge advances to become a world
leader in high technology manufacturing, and needs
markets for its products and places to invest in
• India has made rapid advances in software and service
outsourcing, but needs markets for its services and
injection of capital for manufacturing technologies and
infrastructure development
• It is obvious that the India and Taiwan as well as Japan
could benefit greatly through intensifying their economic
cooperation and trade
• Yet trade and investment between India and Taiwan is
trivially, embarrassingly small—a couple of billion dollars
• Why
Understanding Before Action
• There have been many meetings and conferences on
promoting India-Taiwan trade
• Many agreements have been signed and steps taken to
promote trade and investment
• Yet the scale is small, and growth rate low
• To get India-Taiwan trade on the world map, we need not 10
or 20 percent growth but 100 or 200 percent growth per year
• What will it take to achieve this?
• We must appreciate the nature of the obstacles before we can
remove them
• Historical precedent is quite favorable
– Regions of India, China and Japan had vibrant trade
during sixth to fourteenth century AD (Tansen Sen’s book)
Some Basic Considerations
• Over the past decade, a beginning has been made to
open an India-Taiwan dialog
• However, this dialog seems to have been focused
directly on trade and investment
• But trade and investment takes place when people feel
they know each other and are comfortable with each
other
• In order to make a significant dent, this dialog must be
conceived in broader terms than it has been in the past
• I shall mention a few such areas and they will require us
to go beyond meetings focused directly on promotion of
trade and economic cooperation among business people
and government officials
When Do People Do Business with
One Another?
• When they feel comfortable with one another:
Shared trust
• Shared trust arises from
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Shared language
Shared experiences
Shared history
Shared interests
Shared system
Shared values
• What can India, Japan and Taiwan do to
promote such trust among their people
Language
• Chinese, Japanese and Korean share many
elements of language
• Few Indians know, or have opportunity to learn
Chinese or Japanese in schools or colleges
• Few Taiwanese and Japanese know any Indian
languages, and many need a translator to do
business in English
– Are you speaking “Indian”?
• Need to create language programs in schools
and colleges
Shared Experiences
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There little tourism among these countries
Few personal friendships
Few family or marital relationships
Only a small number of business contacts
Hindi and Kung Fu movies, and karaoke help,
but not enough
• Little knowledge of likes and dislikes
• Little knowledge of the protocol even though
there are many similarities
Shared History
• Fortunately, India, China and Japan share a great deal in
history
• Buddhism permeates the culture of all three countries
• Ironically, it is not always recognized in India
• In my travels through Japan, Taiwan and Mainland China, I
am constantly amazed at how much these societies share in
their philosophy, values, religion, social norms, and history
• Yet, few people in any of these countries are aware of these
deep links
• Most people from these countries see one another as cultural
strangers and cannot penetrate through the barriers of
language (West as intermediary in the East)
• Racial stereotypes, even prejudiced views of one another
Shared Interests
• Few people know about the literature of the
other countries
• Few translations of famous literary work into
local languages
• All such activity is focused on relationships with
the west
• Few people know of classical or popular music,
dance or theater
• Few people know or appreciate the food of the
others
Shared System
• Few people understand the political
structure of the other country
• Few people understand the legal system
of the other country
• Few people understand the business
practices of the other country
• Few people understand the family
structure of the other country in spite of so
much that is common
Share Values
• Fortunately, in spite of so much that we need to do to
increase what these three countries share
• India, Japan and Taiwan do share important common
values
– Freedom of choice for their people
– Democracy
– Increasingly open markets
• Belief that freedom, democracy and markets are
important in themselves
• They also help improve the lives of their people
• With these values as a guiding light, a great deal can be
accomplished to advance the lives of the people of these
societies
The Path Ahead
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What can India and Taiwan (and Japan) do at a fundamental level to
overcome these obstacles
School education: languages, history
College and professional education: law, business management,
engineering, medicine
Cultural exchanges: film, music, dance
Educational exchanges: students, faculty, visits of foreign executives
Specialized management programs about the business and economics of
the other country
Make it easier for citizens of one country to reside and work in the other for
a long period of time
Create conditions in which friendships and personal relationships can
develop, and economic relationships tend to follow
Basically, get to know each other better and become comfortable, and
develop personal friendships
Governments can help create these conditions so people can take over
from there
The Future
• It is often said that the world is shrinking in distances: 22
hours from New York to Taipei
• More important, the SYSTEM is shrinking
• More and more countries find prosperity and happiness
for their people in the same system of freedom and
democracy
• The critical part of the future lies in choosing this right
system shared by India, Japan and Taiwan
• When we are interested in the welfare of the people
system is important, country is not
• Country is fast being relegated to a secondary role—look
at Europe
Thank You
www.som.yale.edu/faculty/sunder
Shyam.sunder@yale.edu