The Global Microchip Conflict: The Semiconductor Fault Line Through Taiwan
- Ankit Budania
- Apr 18
- 1 min read
Semiconductors power everything from consumer electronics to advanced defence systems, making them central not just to commerce but to national security and technological dominance. As the gap between chip design and fabrication costs has widened, the industry has structurally shifted—consolidating advanced manufacturing in a few geographies, most notably Taiwan. This concentration has transformed Taiwan into a geopolitical fault line where supply chains, strategic control, and great-power competition intersect.
This article was originally published on Observer Research Foundation and authored by Ankit Budania
Excerpts from the ORF report - The semiconductor industry is increasingly defined by a structural imbalance: design has scaled globally, while advanced manufacturing has consolidated into a few highly specialized geographies. This divergence has created a system where innovation is distributed, but production—and control—are not.
Taiwan sits at the center of this architecture. Its dominance in advanced-node fabrication underpins critical global supply chains, transforming semiconductors from an industrial input into a strategic asset—and elevating Taiwan into a central fault line in great-power competition.