China Taiwan Issue Explained

• The first known settlers in Taiwan were Austronesian tribal people, who are thought to have come from modern day southern China.
• The island seems to have first appeared in Chinese records in AD239, when an emperor sent an expeditionary force to explore the area – a fact Beijing uses to back its territorial claim.
• After a relatively brief spell as a Dutch colony (1624-1661), Taiwan was administered by China's Qing dynasty from 1683 to 1895.
• From the 17th Century, significant numbers of migrants started arriving from China, often fleeing turmoil or hardship. Most were Hoklo Chinese from Fujian (Fukien) province or Hakka Chinese, largely from Guangdong. Their descendants are now by far the largest demographic groups on the island.
• In 1895, Japan won the First Sino-Japanese War, and the Qing government had to cede Taiwan to Japan. After World War Two, Japan surrendered and relinquished control of territory it had taken from China. The Republic of China (ROC) – one of the victors in the war – began ruling Taiwan with the consent of its allies, the US and UK.
• But in the next few years a civil war broke out in China, and the then-leader Chiang Kai-shek's troops were defeated by Mao Zedong's Communist army.
• Chiang, the remnants of his Kuomintang (KMT) government and their supporters – about 1.5m people – fled to Taiwan in 1949.
• This group, referred to as Mainland Chinese, dominated Taiwan's politics for many years though they only account for 14% of the population. Chiang established a government in exile in Taiwan which he led for the next 25 years.
• Chiang's son, Chiang Ching-kuo, allowed more democratisation after coming to power. He faced resistance from local people resentful of authoritarian rule and was under pressure from a growing democracy movement.
• President Lee Teng-hui, known as Taiwan's “father of democracy”, led constitutional changes towards, which eventually made way for the election of the island's first non-KMT president, Chen Shui-bian, in 2000.

Taiwan, officially known as the Republic of China (ROC), is an island separated from China by the Taiwan Strait. It has been governed independently of mainland China, officially the People’s Republic of China (PRC), since 1949.

The PRC views the island as a renegade province and vows to eventually “unify” Taiwan with the mainland. In Taiwan, which has its own democratically elected government and is home to twenty-three million people, political leaders have differing views on the island’s status and relations with the mainland.

Cross-strait tensions have escalated since the election of Taiwanese President Tsai Ing-wen in 2016. Tsai has refused to accept a formula that her predecessor, Ma Ying-jeou, endorsed to allow for increased cross-strait ties. Meanwhile, Beijing has taken increasingly aggressive actions, including by flying fighter jets near the island. Some analysts fear a Chinese attack on Taiwan has the potential to draw the United States into a war with China.

• There is disagreement and confusion about what Taiwan is.
• It has its own constitution, democratically-elected leaders, and about 300,000 active troops in its armed forces.
• Chiang's ROC government-in-exile at first claimed to represent the whole of China, which it intended to re-occupy. It held China's seat on the United Nations Security Council and was recognised by many Western nations as the only Chinese government.
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• But by the 1970s some countries began to argue that the Taipei government could no longer be considered a genuine representative of the hundreds of millions of people living in mainland China.
• Then in 1971, the UN switched diplomatic recognition to Beijing and the ROC government was forced out. In 1978, China also began opening up its economy. Recognising opportunities for trade and the need to develop relations, the US formally established diplomatic ties with Beijing in 1979.
• Since then the number of countries that recognise the ROC government diplomatically has fallen drastically to about 15.
• Now, despite having all the characteristic of an independent state and a political system that is distinct from China, Taiwan's legal status remains unclear.

• Beijing asserts that there is only “one China” and that Taiwan is part of it. It views the PRC as the only legitimate government of China, an approach it calls the One-China principle, and seeks Taiwan’s eventual “unification” with the mainland.
• Beijing claims that Taiwan is bound by an understanding known as the 1992 Consensus, which was reached between representatives of the Chinese Communist Party (CCP) and the Kuomintang (KMT) party that then ruled Taiwan. However, the two sides don’t agree on the content of this so-called consensus, and it was never intended to address the question of Taiwan’s legal status.
• For the PRC, as Chinese President Xi Jinping has stated, the 1992 Consensus reflects an agreement that “the two sides of the strait belong to one China and would work together to seek national reunification.”
• For the KMT, it means “one China, different interpretations,” with the ROC standing as the “one China.”
• Taiwan’s KMT-drafted constitution continues to recognize China, Mongolia, Taiwan, Tibet, and the South China Sea as part of the ROC.
• The KMT does not support Taiwan’s independence and has consistently called for closer ties with Beijing. But in the face of recent election losses, KMT leaders have discussed whether to change the party’s stance on the 1992 Consensus.
• The KMT’s chief rival party, the Democratic Progressive Party (DPP), has never endorsed the understanding laid out in the 1992 Consensus. President Tsai, who is also the leader of the DPP, has refused to explicitly accept the consensus. Instead, she has attempted to find another formulation that would be acceptable to Beijing.
• In her 2016 inaugural address, Tsai noted she was “elected president in accordance with the Constitution of the Republic of China,” which is a one-China document, and said she would “safeguard the sovereignty and territory of the Republic of China.” Tsai also pledged that she would “conduct cross-strait affairs in accordance with the Republic of China Constitution, the Act Governing Relations Between the People of [the] Taiwan Area and the Mainland Area, and other relevant legislation.” Beijing, however, rejected this formulation and cut off official contacts with Taiwan.
• In a 2019 speech, Xi reiterated China’s long-standing proposal for Taiwan: that it be incorporated into the mainland under the formula of “one country, two systems.” This is the same formula used for Hong Kong, which was guaranteed the ability to preserve its political and economic systems and granted a “high degree of autonomy.” Such a framework is deeply unpopular among the Taiwanese public. Pointing to Beijing’s recent crackdown on Hong Kong’s freedoms, Tsai and even the KMT have rejected the “one country, two systems” framework.

• It is the diplomatic acknowledgement of China's position that there is only one Chinese government. Under the policy, the US recognises and has formal ties with China rather than the island of Taiwan, which China sees as a breakaway province to be reunified with the mainland one day.
• The One China policy is a key cornerstone of Sino-US relations. It is also a fundamental bedrock of Chinese policy-making and diplomacy. However, it is distinct from the One China principle, whereby China insists Taiwan is an inalienable part of one China to be reunified one day.
• The US policy is not an endorsement of Beijing's position and indeed as part of the policy, Washington maintains a “robust unofficial” relationship with Taiwan, including continued arms sales to the island so that it can defend itself.
• Although Taiwan's government claims it is an independent country officially called the “Republic of China”, any country that wants diplomatic relations with mainland China must break official ties with Taipei.
• This has resulted in Taiwan's diplomatic isolation from the international community.

• Relations started improving in the 1980s as Taiwan relaxed rules on visits to and investment in China. In 1991, it proclaimed that the war with the People's Republic of China was over.
• China proposed the so-called “one country, two systems” option, which it said would allow Taiwan significant autonomy if it agreed to come under Beijing's control. This system underpinned Hong Kong's return to China in 1997 and the manner in which it was governed until recently, when Beijing has sought to increase its influence.
• Taiwan rejected the offer and Beijing's insisted that Taiwan's ROC government is illegitimate – but unofficial representatives from China and Taiwan still held limited talks.
• Then in 2000, Taiwan elected Chen Shui-bian as president, much to Beijing's alarm. Mr Chen and his party, the Democratic Progressive Party (DPP), had openly backed “independence”.
• A year after Mr Chen was re-elected in 2004, China passed a so-called anti-secession law, stating China's right to use “non-peaceful means” against Taiwan if it tried to “secede” from China.
• Mr Chen was succeeded by the KMT's Ma Ying-jeou in 2008 who tried improving relations through economic agreements.
• Eight years later, in 2016, Taiwan's current president Tsai Ing-wen, who now leads the independence-leaning DPP, was elected.
• The rhetoric sharpened further in 2018 as Beijing stepped up pressure on international companies – if they failed to list Taiwan as a part of China on their websites, it threatened to block them from doing business in China.
• Ms Tsai won a second term in 2020 with a record-breaking 8.2 million votes in what was widely seen as a snub to Beijing. By then Hong Kong had seen months of unrest, with huge protesters against the mainland's growing influence – and many in Taiwan were watching closely.
• Later that year, China's implemented a national security law in Hong Kong that is considered to be yet another sign of Beijing's assertion.

• Tensions have been rising since then-President Donald Trump made it U.S. policy to tighten ties with Taiwan. That has continued under President Biden, with the U.S. sending weapons, special military training units and delegations of former officials in a show of support for Taiwanese President Tsai Ing-wen, whom Beijing sees as dangerously pro-independence.
• Mr. Biden turned up the temperature during his first visit to Asia as commander in chief in May 2022. Asked by a reporter whether the U.S. would get involved militarily in a Chinese attack on Taiwan after declining to send American troops to Ukraine to fight Russia’s invasion, he said, “Yes. That’s the commitment we made.”
• The clarity of the comment clashed with Washington’s longtime practice of saying little about how the U.S. would respond to an invasion of Taiwan—a stance known as strategic ambiguity. 
• China’s Foreign Ministry lashed out at Mr. Biden almost immediately after his remarks, despite White House officials saying U.S. policy hadn’t changed. The ministry said Beijing “has no room for compromise and concession” on core concerns, including Taiwan, and would take firm action to defend its security interests.
• On Aug. 2, House Speaker Nancy Pelosi traveled to Taiwan, defying stiff warnings from Beijing of unspecified countermeasures. The trip, which is expected to include meetings with Taiwan government officials, comes just days after a phone call between President Biden and Chinese leader Xi Jinping, in which Mr. Xi warned against such a visit. It also comes as China celebrates the anniversary of the founding of its military, and as Mr. Xi prepares to break with recent precedent and secure a third term in power later this year.
• On the day of Mrs. Pelosi’s flight to Taipei, the website of Taiwan’s presidential office was taken by overseas hackers, Taiwan’s government said. Minutes after her plane landed, China said it would conduct live-fire exercises in the airspace and waters around the island for four days.

• China’s military, the People’s Liberation Army, has sent jet fighters, bombers and spy planes on hundreds of sorties near Taiwan over the past year. Taiwan describes the sorties and other military moves by China in the region as a form of “gray zone” warfare, designed to probe and exhaust the island’s defenses while discouraging Taipei from tightening ties with Washington and other democratic capitals.
• China has often conducted military exercises around Taiwan in response to the presence nearby of U.S. aircraft-carrier strike groups.
• Beijing has also begun a major expansion of its nuclear arsenal, partly to deter the U.S. from using its own nuclear weapons in a conflict over Taiwan. 

• Defense analysts have long questioned Taiwan’s ability to resist a Chinese attack. Taiwanese soldiers and reservists have themselves expressed concerns about training and readiness.
• In response, Taiwan’s government established an agency to revamp reserve forces. It has also staged exercises it hopes will deter Beijing from contemplating an invasion.
• More recently, the war in Ukraine has led Taiwan to rethink its preparations for an attack, with some lawmakers pushing for more purchases of the portable antitank and antiaircraft missiles that Ukrainian soldiers have used to great effect. The island’s military is also considering extending conscription to 12 months from the current four—a proposition that was widely considered a political impossibility before the war.

• Officially, the U.S. government abides by a “One China” policy that recognizes the People’s Republic of China as the country’s only legitimate government and acknowledges—but doesn’t endorse—Beijing’s claims over Taiwan.
• Since 1979, U.S. policy toward the defense of Taiwan has been governed by a law known as the Taiwan Relations Act, which holds that any attempt to determine Taiwan’s political future through anything other than peaceful means constitutes a threat to American interests. The act commits the U.S. to sell weapons to Taiwan for its self-defense, but is conspicuously silent on whether the U.S. is obligated to defend Taiwan in the event of an attack.
• For decades, Washington has strategically avoided making a commitment either way, in the hope that uncertainty about its posture will prevent both Beijing and Taipei from making moves to upset the status quo.

• A top concern among U.S. analysts is that China’s growing military capabilities and assertiveness, as well as the deterioration in cross-strait relations, could spark a conflict. Such a conflict has the potential to lead to a U.S.-China confrontation. That’s because China hasn’t ruled out using force to achieve Taiwan’s “reunification” and the United States hasn’t ruled out defending Taiwan if China attacks. The U.S. Department of Defense said in a 2021 report [PDF] that China’s military, the People’s Liberation Army (PLA), is “likely preparing for a contingency to unify Taiwan with the PRC by force, while simultaneously deterring, delaying, or denying any third-party intervention, such as the United States.”
• However, experts disagree about the likelihood and timing of a Chinese invasion. The top U.S. military commander in the Indo-Pacific warned in 2021 that China could try to invade Taiwan within the next decade, while some experts believe that such an invasion is further off. Others believe 2049 is a critical date; Xi has emphasized that unification with Taiwan is essential to achieving what he calls the Chinese Dream, which sees China’s great-power status restored by 2049.
• Russia’s invasion of Ukraine in early 2022 reignited the debate, with some analysts arguing that Moscow’s moves could embolden Beijing to similarly invade Taiwan and others saying that Beijing could become more cautious after witnessing Russia’s challenges. CFR’s Sacks writes that Russia’s actions won’t influence China’s willingness to use force, but that “Chinese leaders will examine Russia’s failures and adapt their operational plans to avoid making similar mistakes.”
• Regardless, the PLA has made preparing for a Taiwan contingency one of its top priorities, and Taiwan has been a major catalyst for China’s military modernization. In a 2019 defense white paper, the PLA said it would “resolutely defeat anyone attempting to separate Taiwan from China.”
• Taiwan likely doesn’t have the capabilities to defend against a Chinese attack without external support, analysts say. Even though Tsai and the DPP have prioritized increasing defense spending, with a record budget of nearly $17 billion for 2022, China’s spending [PDF] is still estimated to be around twenty-two times Taiwan’s. In 2022, Taiwanese lawmakers approved the Tsai government’s plan to spend an extra $8.6 billion on defense over the next five years. Part of this expanded military budget will go toward acquiring cruise missiles, naval mines, and advanced surveillance systems to defend Taiwan’s coasts.

• Taiwan’s economy remains reliant on trade with China, which is the island’s largest trading partner. However, their economic relationship has experienced disruptions in recent years, partly due to Beijing’s pressure on the island and Taiwanese officials’ growing concern about its overreliance on trade with China.
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• Under President Ma, who was in office from 2008 to 2016, Taiwan signed more than twenty pacts with the PRC, including the 2010 Cross-Straits Economic Cooperation Framework Agreement, in which they agreed to lift barriers to trade. China and Taiwan resumed direct sea, air, and mail links that had been banned for decades. They also agreed to allow banks, insurers, and other financial-service providers to work in both markets.
• Tsai and the DPP, on the other hand, have attempted to diversify Taiwan’s trade relationships, with mixed results. Tsai has had some success boosting trade with and investment in countries in Southeast Asia and the Indo-Pacific through a signature initiative, the New Southbound Policy. Trade between Taiwan and the eighteen targeted countries increased by more than $50 billion between 2016, when the initiative was unveiled, and 2021. Taiwanese investment in those countries has also steadily increased. In 2019, Tsai unveiled a three-year plan to incentivize Taiwanese manufacturers to move from the mainland back to Taiwan.
• Still, in 2021, Taiwan’s exports to China hit an all-time high. Beijing has pressured countries not to sign free trade agreements with Taiwan. A handful of countries have signed free trade pacts with the island; New Zealand and Singapore are the only developed economies to sign such agreements. Beijing has also pushed for Taiwan’s exclusion from multilateral trading blocs, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the Regional Comprehensive Economic Partnership (RCEP). (China is included in the RCEP but not in the CPTPP.) Taiwan also is not part of the Biden administration’s Indo-Pacific Economic Framework.

• Taiwan is the world’s top contract manufacturer of semiconductor chips, and its industry is booming despite cross-strait tensions. These chips are found in most electronics, including smartphones, computers, vehicles, and even weapons systems that rely on artificial intelligence. Companies in Taiwan were responsible for more than 60 percent of revenue generated by the world’s semiconductor contract manufacturers in 2020.
• Much of that can be attributed to Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest contract chip maker and the top supplier for Apple and other U.S. companies. It is one of only two companies in the world (the other is South Korea-based Samsung) that has the technological know-how to make the smallest, most advanced chips, and it manufactures more than 90 percent of them.
• Some experts argue that the United States’ dependence on Taiwanese chip firms heightens its motivation to defend Taiwan from a Chinese attack. Recognizing the extent to which the United States relies on one company for critical chips, Biden has led a push to strengthen the U.S. chip industry. China also relies on Taiwanese chips, though not as much as the United States does. Beijing is working to boost its industry, especially as Washington has pushed TSMC to stop selling to Chinese companies, including Huawei, a Chinese telecommunications giant that Washington claims Beijing could use for espionage.

HISTORY OF INDIA-TAIWAN ENGAGEMENT–

• 1949: India recognised PRC, not the ROC as the government in Taiwan calls itself, and adopted the “One China policy”
• Relations with Taipei were more or less frozen through the Cold war era
• 1995: India-Taipei association was established, and led to the setting up of an Indian office in Taipei, and the Taipei Economic and Cultural Centre in Delhi- but while they both issue visas, they are not the equivalent of diplomatic relations
• India has always been sensitive to China’s concerns, but after a number of Chinese aggressions at the Line of Actual Control in 2010, comments on Arunachal Pradesh, as well visa issue on Jammu Kashmir, India stopped the use of the “One China Policy”
• In 2011 Delhi and Taipei signed a “Double Taxation Avoidance Agreement” and “Customs Mutual Assistance Agreement” in July 2011
• In 2018, Delhi and Taipei signed a bilateral investment agreement
• As Chinese PLA aggressions at the Line of Actual Control led to the Galwan killings in 2020, calls for India to step up its ties with Taiwan have grown, coupled with questions about whether India, as a newly active member of the Quad will take a more vocal approach on China-Taiwan developments, or remain sensitive to its ties with Beijing. For the moment the latter seems the more likely option.
• Remember, The United Nations and most countries recognise the PRC in Beijing as the sole legal government of China (which means they don’t recognise the ROC in Taipei). Currently fifteen states recognise Taiwan as the ROC (and thus do not have official relations with Beijing): Belize, Guatemala, Haiti, Holy See, Honduras, Marshall Islands, Nauru, Nicaragua, Palau, Paraguay, St Lucia, St Kitts and Nevis, St Vincent and the Grenadines, Swaziland and Tuvalu. Another 57 have representative offices, like India does, and China has succeeded in reversing two countries over (Map)

WHY DOES THE TENSION BETWEEN CHINA AND TAIWAN MATTER TO INDIA

• It leads to Instability in the region
• Government is already dealing with Chinese aggression at the LAC, would like to avoid actions that would precipitate more violence
• India’s membership of the Quad- with US, Japan and Australia is committed to keeping the Indo-Pacific region free and open
• India is also a member of SCO, BRICS, RIC with China

AREAS WHERE INDIA'S TIES WITH TAPEI COULD GROW

• Tourism
• Trade: Bilateral trade increased from about $2 bn in 2006 to $5.7 bn in 2020. (Trade figures with China for same years were  $90 bn/2020 for India and $149.2 billion for Taiwan)
• Investment in semiconductor technology: According to reports India and Taiwan are in talks on an agreement that could bring a chip plant worth an estimated $7.5 billion to India to supply everything from 5G devices to electric cars.
• Health relations: Especially in the wake of the Coronavirus pandemic, both Delhi and Taipei can step up health and science research
• Cultural ties