The U.S. government is not seeking to “decouple” from China, nor is it seeking “technological decoupling,” but Washington “would like to see India achieve its aspirations to play a larger role in the electronics supply chain,” U.S. Commerce Secretary Gina Raimondo said on Friday.
On its part, the U.S. signed a memorandum of understanding with India on Friday to cooperate in the semiconductor sector.
The semiconductor industries in both the nations are beginning to assess the resiliency and gaps in the supply chain network, said Raimondo, whose department is overseeing pouring of about $52 billion into the U.S. semiconductor industry.
“You don’t have to believe me when I say that this is a consequential relationship and the U.S. government is excited to lean into this relationship with the government of India… the fact that ten leading CEOs from the U.S. came here and have pledged to do more business in India… I think that’s a testament,” she told reporters at a press conference in New Delhi.
India, the world’s second most populous nation, holds key importance in the ever-shifting geopolitical relationships among many powerful nations. The U.S.’s increasing alliance with India, with whom it also maintains a strategic dialogue through a Quad group with Japan and Australia, is emblematic of the growing concerns from American policymakers to cut reliance on China.
But even as India and the U.S. tighten their tech ties, Washington is not looking to cut reliance on China, she insisted. “We see India as a trusted technology partner and we want to continue to deepen our technological relationship with India. But I also want to make it clear that the United States doesn’t seek to decouple from China.”
“What we seek to do is ensure that certain technologies where the United States is ahead and where China’s explicit strategy is to have these technologies and deploy them in Chinese military apparatus, those are technologies that we have used export control to ban the sale to China. So we enjoy trade with China. The vast majority of trade with China is in benign products and that will and should continue.”
The closer ties with India isn’t about decoupling, but it’s about keeping “eyes wide open to the fact that China is explicitly trying to get access to American technologies for use in its military and we need to protect ourselves and our allies and partners,” she added.
The partnership comes as India is aggressively offering $10 billion in incentives to win manufacturing projects from international chip firms. New Delhi has been able to attract a number of firms to expand their presence in India, but many industry leaders including Intel and TSMC have yet to make a broader play.