Taiwan And India Chart Distinct Paths In AI Race

On January 16, 2026, two major developments on opposite sides of the globe signaled a new era for artificial intelligence (AI) and technology policy. Taiwan, a linchpin of the global semiconductor industry, intensified its push for a favorable tariff agreement with the United States, leveraging its prowess in AI and advanced chip manufacturing. Meanwhile, India announced it would host the fourth global AI Summit in February, emphasizing an inclusive approach to AI that prioritizes real-world impact over technological one-upmanship. Together, these moves reveal how the world’s leading democracies are shaping the future of AI—each on their own terms, but with eyes firmly set on global influence, economic growth, and societal transformation.

In Taipei, government officials and industry leaders have been locked in intensive negotiations with their U.S. counterparts. The core of Taiwan’s strategy? Use its critical role in AI and semiconductor supply chains as leverage to secure lower tariffs on its exports, particularly those vital to high-tech industries. According to Meyka, the standard reciprocal tariff rate is set to drop from around 20% to 15% for many Taiwanese products, with some sectors—like generic pharmaceuticals and aircraft components—benefiting from zero tariffs. This shift, if ratified by Taiwan’s legislature, would mark a major policy victory for the island and could reshape the global tech trade landscape.

The stakes are high for Taiwan. Its economy leans heavily on high-tech exports, and companies like Taiwan Semiconductor Manufacturing Company (TSMC) are already key players in the global AI boom. TSMC’s massive investments in U.S. facilities, especially in Arizona, support giants like Apple, Qualcomm, and Nvidia—firms whose products are foundational to AI workloads in everything from smartphones to sprawling data centers. By tying tariff reductions to deeper cooperation in AI and semiconductor manufacturing, Taiwan hopes to secure its competitive edge and attract even more foreign direct investment into AI-related production abroad.

But it’s not just about lower tariffs. Taiwan has pledged at least $250 billion in direct investments in U.S. semiconductor and AI production facilities, with the government backing these commitments with up to $250 billion in credit guarantees. These guarantees will help Taiwanese firms expand in the U.S. market—particularly in AI chip manufacturing, energy infrastructure, and advanced logic chips—sectors at the heart of global technology competition. The agreement also includes provisions for importing related technologies into new U.S. production facilities at lower or zero tariffs, encouraging capital investment and expertise transfer across borders.

This ambitious framework aligns with broader U.S. policy objectives to reshore advanced semiconductor manufacturing and reduce dependency on foreign supply—especially for the chips that power AI applications and data centers. As Meyka notes, “The tariff agreement helps stabilize trade costs, encourages expanded manufacturing capacity in the U.S., and strengthens cooperation on AI technology.” For Taiwanese exporters, lower tariffs mean more predictable trade costs and the ability to plan long-term production and pricing strategies with greater confidence. For global investors, this clarity could reshape expectations for AI stocks and technology companies with exposure to Taiwan’s semiconductor ecosystem, potentially lifting valuations as tariff risk recedes.

Yet, these negotiations don’t unfold in a vacuum. The Taiwan-U.S. talks come amid heightened geopolitical tensions and fierce competition for technological leadership. Taipei must walk a fine line, seeking deeper AI and semiconductor collaboration with the U.S. while maintaining its technological independence and managing complex relationships with other major powers. Some lawmakers in Taiwan’s legislature have voiced concerns about balancing market openness with protection for domestic industries. Still, government leaders argue that the long-term benefits—tariff relief, expanded AI cooperation, and stronger supply chain resilience—far outweigh the short-term risks.

As the world’s economic and technological heavyweights jockey for position, India is charting its own distinctive course. On the same day Taiwan’s tariff push made headlines, India announced it would host the fourth AI Summit in New Delhi in February 2026. But unlike previous summits, which focused on “action,” India’s gathering will pivot sharply toward “impact.” According to Gourangalal Das, India’s ambassador to the Republic of Korea, the shift is more than just a matter of semantics. “Technologies should be measured not by the level of sophistication or the bottom line or even by national power, but by the transformation they will bring to human lives and societies at large,” he wrote in KED Global.

As the first country from the Global South to host the AI Summit, India is determined to ensure that AI doesn’t deepen the divide between haves and have-nots. Its AI Mission, now nearly two years old, is built on a philosophy of “AI for All.” The mission emphasizes inclusive development and real-world problem-solving, targeting groups that are often overlooked: marginal farmers, informal sector workers, small entrepreneurs, and linguistically diverse communities. With over 1,600 AI-focused startups and 16% of the world’s AI talent, India is betting that scale, access, and public infrastructure matter more than simply amassing the largest AI models or the most GPUs.

India’s approach is pragmatic and rooted in its unique context. The government’s dataset platform provides startups with access to vast quantities of high-quality, non-personal data—helping them overcome one of the biggest barriers to innovation. The Mission’s fellowships support not just engineers, but also professionals in medicine, law, commerce, and the liberal arts, fostering an environment where AI can address a broad array of societal challenges. In January 2026, the government launched a skilling program to train one million youth in AI-related skills within a year, bringing opportunity to big cities and small towns alike.

Perhaps most notably, India is developing the world’s first government-funded multimodal large language model (LLM) initiative. Unlike most commercial LLMs, which are trained primarily on text, India’s model is designed to reflect the country’s vast range of literacy levels and languages. The goal: create unbiased, reliable, and democratized AI models that represent India’s true reality and leave none of its 1.4 billion citizens behind. Applications already in development include tools for cancer diagnosis, agricultural advice for farmers, and digital inclusion for non-English speakers.

India’s open-source, society-oriented approach stands in contrast to the proprietary AI technologies prevalent in wealthier countries. By enabling government initiatives, academic institutions, and private innovators to collaborate, India has reduced AI development cycles from years to months and promoted cost-effective adoption across diverse sectors. The country’s successful experience with digital public infrastructure—now being replicated elsewhere—shows that innovation combined with inclusion can make a real impact at scale.

As the AI Impact Summit approaches, India’s vision is finding resonance beyond its borders. Prime Minister Modi’s call for “AI for All” at the Paris AI Summit has been echoed by leaders like South Korea’s President Lee Jae Myung at the UN and APEC. There’s growing recognition that technology-driven economic growth must go hand in hand with social inclusion, not polarization.

Back in Taiwan and the U.S., the coming months will show whether the ambitious tariff and investment deal will pass Taiwan’s legislature and how companies like TSMC and their global partners will respond. In India, the AI Summit will test whether its inclusive, impact-focused approach can inspire other nations to rethink how AI is developed and deployed. One thing is clear: the choices made in Taipei, New Delhi, and Washington will shape the global tech landscape for years to come.

As these two nations demonstrate, the future of AI isn’t just about who builds the biggest model or the fastest chip—it’s about who can harness this technology to drive prosperity, resilience, and opportunity for all.