Most Indian businesses fail to realise the potential in Taiwan when looking at markets in the region. They might go to Hong Kong or Singapore and see mainland China as a land of opportunity - but Taiwan is not the first place that comes to their mind when considering export or business expansion.

It is probably because Taiwan is often overshadowed by it Asian neighbors. Another reason is that Taiwan is often considered as  as a mere extension of China, not as a market that stands apart.

But Taiwan is equally dynamic as its Asian neighbors and despite officially being a province of the Republic of China, it is a market that stands apart brimming with opportunities. The country's GDP per capita is over ten times than that of China, which is reflected in the country's sophisticated infrastructure and buying power. There is a huge reservoir of wealthy consumers here and if you are considering doing business even in China, it is well worth considering starting with Taiwan as an entry route.        
 
Taiwan has a dynamic capitalist economy with gradually decentralisation of investment and foreign trade decisions. Exports have provided the primary impetus for industrialisation, and it has emerged as one of East Asia's economic "tigers". The island runs a large trade surplus, and its foreign reserves are among the world's largest. 

Taiwan: A bird's eye view

• Area:  35,980 sq km
• Languages:  Mandarin Chinese (official), Taiwanese (Min), Hakka dialects
• Population:  22,920, 946 (July 2008)
• Population growth rate:  0.24% (2008 est.)
• Literacy:  96.1% (2003)
• Inflation rate (consumer price):  1.8% (2007 est.)
• GDP (purchasing power parity):  $695.4 billion (2007 est.)
• GDP per capita (PPP):  $30,1000 (2007 est.)
• GDP, real growth rate:  5.7% 92007, est.)
• GDP (by sector):  Agri- 1.4%, Industry- 27.5%, services- 57.9% (2007 est.)
• Currency:  New Taiwan Dollar (TWD)
• Main industries:  Electronics, petroleum refining, chemicals, textiles, armaments, machinery, iron & steel, cement, food processing, vehicles, consumer products, pharmaceuticals, etc. 

• 1. China (US $38.58 million)
• 2. Hong Kong (US $13.2 million)
• 3. Vietnam (US $10.55 million)
• 4. Italy (US $8.4 million)
• 5. Japan (US $7.69 million)

Almost 39% of Taiwan's imports of RMG are from China while India is the 11th most significant RMG source country for Taiwan. Hong Kong's share in RMG imports of Taiwan has experienced a fall of 41% during this period.

RMG products Taiwan imports from the world and India's share

Competition and opportunities
In Taiwan, there are so many local brands who offer a wide variety of product mix from contemporary to street fashions at lower price points. These local brands dominate the low end of the clothing and accessories sector. But most of these local brands are not perceived as luxurious or high-value added as their imported counterparts. The niche areas of potential for Indian RMG exporters are (i) mid to high end accessories, (ii) contemporary men’s wear, (iii) contemporary women’s wear, etc.

Regulations and constraints
RMG products imported to Taiwan are subject to import duty which may range from 10 -12 % depending upon the fabric composition and styles. Taiwan has produced a "List of Commodities Subject to Import Restriction" which lists goods for which an import license is required. There are also regulatory constraints on garments made in China. Exporters interested to export to Taiwan may browse www.trade.gov.tw for a complete list of exportable products without restrictions.  

Customs duties
In Taiwan, import duties are levied on an ad valorem basis, determined by the transaction price, i.e. the actual price paid for the goods brought into Taiwan, including freight, commission and royalties.

Small things make a big difference

• It is advisable to hire a local agent or distributor while exporting your products to Taiwan.
• Exporters are also strongly advised to check labelling requirements with their agents before shipping goods. 
• Sales in in knitwear, wool and cashmere merchandise are generated primarily in the autumn/winter seasons while spring and summer are the best time to sell light and comfortable materials.
• Exporters should visit the market on a regular basis so that they can understand the changing tastes of the local customers and build solid relationship with the local distributors.
• Indian exporters should target shopping malls, department stores and independent boutiques in Taiwan as they prefer stocking a variety of labels in their stores to get competitive advantage over their competitors.   
• In Taiwan, business relationships are based on respect. Punctuality is of great importance in Taiwan and business hours are similar to Western countries.