INDIA
- USA PACT ON SEMICONDUCTOR - INTERNATIONAL
News: India, U.S. to launch a
semiconductor sub-committee
What's
in the news?
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India and the US signed a pact on setting up a semiconductor supply chain and
innovation partnership, and established a semiconductor sub-committee under
the framework of the India-US Commercial Dialogue, revived after three years.
India-US
Commercial Dialogue:
●
The Commercial Dialogue is part of ongoing
efforts to strengthen the U.S.-India
Comprehensive Global Strategic Partnership, develop inclusive and fair
trade and investment policies, and leverage the interests of the private sector
in pursuing new market opportunities that advance prosperity in both countries.
●
The bilateral goods and services trade has
almost doubled since 2014, exceeding US $191 billion in 2022, signalling
accelerated growth benefitting both countries.
●
The
United States became India’s largest trading partner in 2022.
Themes
of the Dialogue:
The key theme of the
dialogue includes
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Focused on resilient and secure supply chains.
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Facilitating climate and clean technology cooperation.
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Inclusive digital growth, talent development, including skilling.
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Post-pandemic
economic recovery, especially for micro, small, and medium enterprises
and start-ups.
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Focus on cooperation on quality standards. India has recognised that there
have to be quality suppliers and consumers in goods and services.
The
Sub-committee on Semiconductors:
●
The Sub-committee will be led by the US’s
Department of Commerce and, on the Indian side, the Ministry of Electronics and Information Technology (MeitY) and the
Ministry of Commerce and Industry.
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The first engagement of the sub-committee
is expected to take place before the end of 2023.
Joint
statement:
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Both sides intended to continue engaging
on cross-border data flows and other relevant issues, including in appropriate
multilateral forums.
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Working together in developing next-generation standards in telecommunications, including
6G.
●
Working together in validation and
deployment of trusted and secure next-generation telecom network equipment,
including Open RAN, as well as in subsequent generations of telecommunications
infrastructure.
Significance:
●
These efforts will identify opportunities
for growth and challenges to address in order to ensure that US and Indian
semiconductor industries develop stronger
connections, complementary ecosystems, and a more diverse supply chain for
semiconductors.
●
Cooperation on semiconductors comes
against the backdrop of the shortage of such chips, which had serious
consequences such as supply disruption in automobile and electronics in both
countries, particularly after the outbreak of Covid-19.
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India offers a large marketplace, and can capitalize on economies of scale to
meet India’s and the world’s needs.
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The US is India’s largest exporter and
trading partner while India is the ninth-largest trading partner for the US.
Bilateral merchandise trade during April-January stood at $108.43 billion. Both
nations aim to achieve bilateral trade of $500 billion by 2025.
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The US is also the third-biggest source of
foreign direct investment for India, and is one of the top five investment
destinations for India.