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Indian and Taiwanese officials are negotiating to bring a $7.5 billion chip plant to India with tariff reductions on components for producing semiconductors by the end of the year.
The plant could supply everything from 5G devices to electric cars.
India is evaluating potential sites with adequate manpower, land, and water.
India would finance 50 percent of capital expenditure from 2023 as well as tax breaks and other incentives.
Officials in Taipei wanted quick progress on a bilateral investment that would lead to a broader trade deal.
The trade talks come at a time when countries are boosting economic and military links to deter an increasingly assertive China.
India is luring high-technology investments as it seeks to become more self-reliant on chips. The country's demand for semiconductors is estimated to increase from about $24 billion now to around $100 billion by 2025.
Meanwhile, Taiwan is strengthening its diplomatic presence around the globe as it pushes back against the pressure from China.
