Taiwan election result can impact China-US ties

ON January 13, Taiwan, a ‘democratic and autonomous’ entity claimed by China, held elections, perceived as the freest in the Chinese-speaking world. Against the backdrop of increasing Chinese assertiveness and challenges in the Indo-Pacific region, the electoral outcome has geopolitical significance for the region.

The election was won by the Democratic Progressive Party (DPP) — its third consecutive victory. Its presidential candidate, outgoing Vice-President Lai Ching-te (William Lai), won 40 per cent of the votes, but the DPP lost parliamentary majority. In 2020, President Tsai Ing-wen had won a second term with 57 per cent of the votes.

This shows that the popular vote in Taiwan is still in favour of the DPP, which is more inclined towards Taiwan’s independence than the main Opposition party, the Kuomintang (KMT). The DPP will have to tie up with other parties. In the new parliament, the DPP has 51 seats, the KMT 52 and the Taiwan People’s Party (TPP) eight.

The TPP secured over 20 per cent of the votes, raising concerns about dwindling traditional support for both the DPP and KMT. In the last election, the People First Party had finished third with only 4 per cent of the votes. Had the KMT and the TPP come together, they could have got more votes than the DPP. Political accommodation is set to be the way forward in Taiwan.

The ruling DPP nominated Lai, with Hsiao Bi-khim, Taiwan’s former representative to the US, being his running mate. The KMT had the Mayor of New Taipei, Hou Yu-ih, as its presidential candidate, aided by media mogul Jaw Shaw-kong. The populist TPP projected local politician Ko Wen-je along with Cynthia Wu, a legislator from the Shin Kong business family.

The new dispensation will have to grapple with the challenges posed by an aggressive China, putting Taiwan in a defensive mode. The Taiwanese President, who is the head of state and the armed forces, will have to deal deftly with China as well as the US.

While all candidates had similar policies for Taiwan’s development, dealing with China remains a primary concern. The KMT and TPP aimed to resume talks with China, particularly on trade agreements, contrary to the stand of the DPP. Even though Lai suggests that he may seek such an opening, China is unlikely to respond to any effort by the DPP to seek an agreement. Taiwan is in the crosshairs of China. In response, the US has rallied its allies, including Japan, Australia and the Philippines, to counterbalance China’s influence in the Indo-Pacific. This strategic move involves Taiwan as a key player in the broader Indo-Pacific policy.

While Taiwan has maintained autonomy since 1945, the poll victory of the DPP has raised tensions. The DPP’s willingness to consider Taiwan’s independence as a viable option has irked China. China denounced Lai as a ‘dangerous separatist’. The island serves as a beacon of democracy in the region and boasts semiconductor capabilities, making it a strategic outpost beyond geopolitical considerations.

China viewed the election as a strategic opportunity and employed various means to influence the outcome. Tactics ranged from economic coercion to disinformation campaigns and visible security challenges. With China seemingly impatient about unification, Taiwan is wary, given the failure of the ‘one country, two systems’ policy in Hong Kong.

The DPP win may cause anxiety in Washington, which, through the Biden-Xi summit in November 2023, tried to bring stability to the US-China relations. The US has clarified that it does not support Taiwan’s independence.

Recent US support for Taiwan has been pivotal, but uncertainty may arise in view of the US presidential election in November and the ongoing global crisis. Taiwan is anxious about the scale of American resources and commitment.

As Taiwan heads into the post-election phase amid heightened regional tensions, the leadership needs to balance the pursuit of independence against the backdrop of historical ties with China. It must shape Taiwan’s trajectory and play a crucial role in the evolving geopolitics of the Indo-Pacific.

The sabre-rattling by China over the last few years and its preference for the KMT have evidently not impressed the Taiwanese voters. They don’t seem to mind the DPP approach and want a better socio-economic policy in Taiwan.

At the same time, robust US statements regarding Taiwan portray it as a frontline state, adding to the Chinese challenge faced in the Indo-Pacific region by Japan (East China Sea), ASEAN (South China Sea) and India (Indian Ocean Region).

From India’s point of view, Taiwan would witness continuity in its policy for another four years. Like in the past eight years, the DPP government will be keen to boost relations with India. With its semiconductor prowess, Taiwan holds the potential to create manufacturing or supply chains in India, a crucial aspect for both nations. Bilateral trade has grown from $1.19 billion in 2001 to $8.45 billion in 2022. There are more than 250 Taiwanese companies already in India; they have made a combined investment of around $4 billion in the country. The de-risking of Taiwanese companies from China could benefit India by attracting more foreign direct investment.

However, India does not consider Taiwan as an important element of its Indo-Pacific policy, though it acknowledges China’s aggressive intent. Any role that India may play in a Taiwan crisis remains uncertain, though the US would like the Quad to support Taipei. Taiwan is an area of ambiguity for India, which does not see it through the eyes of fellow Quad partners — the US, Japan and Australia.