Indo South Korea Agreement

1. Overview: Trade and economic relations between India and the Republic of Korea (Korea) have recovered in recent years, with annual bilateral trade reaching $21.5 billion in 2018, surpassing the $20 billion mark for the first time. Bilateral trade in January-Nov 2019, the latest data for December 2019, recorded $19.05 billion. The Comprehensive Bilateral Economic Cooperation Agreement (EPA), in force since 2010, has boosted trade and investment in both directions. In 2018, Korea`s investment in India exceeded $1 billion for the first time, recording $1.053 billion. The total of Korea`s FDI for India up to September 2019 is $6.29 billion. India`s investments in Korea amount to about $3 billion, led by Tata Daewoo, Ssangyong and Novelis. Prime Minister NarendraModi`s visit to the Republic of Korea from 18 to 19 May 2015 gave a visible boost to bilateral economic relations. India and Korea have agreed to open negotiations to amend the EPA, strengthen cooperation in the energy, electronics and shipbuilding sectors, including the creation of a joint working group on cooperation in the shipbuilding sector and another in the field of electronic equipment production. ROK proposed that India allocate $10 billion (development aid and concession credits) to India for infrastructure projects. Pm recognized the importance of the maritime industry in bilateral relations and also visited Hyundai Heavy Industries` ulsan shipyard.

Heads of state and government from both countries spoke at the inaugural meeting of the India and Korea CEO Forum to promote bilateral economic cooperation, while pm also met with the leaders of major Korean conglomerates. The Korea Plus office was created in India as the only window to resolve all the issues raised by Korean companies following the PM`s visit. President Moon Jae-in`s state visit to India from 10 to 12 July 2019 strengthened bilateral engagement with a common vision of man, peace and prosperity. During the visit, Prime Minister Modi and President Moon set a target of $50 billion for bilateral trade that is expected to be achieved by 2030. To further strengthen bilateral relations, Prime Minister NarendraModi visited the OK from 21 to 22 February 2019 and had a number of bilateral and trade commitments. Prime Minister Modi unveiled a bust of Mahatma Gandhi at the prestigious Yonsei University to commemorate the 150th anniversary of Mahatma Gandhi and also received the Seoul Peace Prize from the Seoul Peace Prize Foundation. 2. Korean economic status and synergies with India: in less than forty years, Korea has made remarkable progress in transforming its economy into an export-oriented force package. Its GDP has grown from just $2.3 billion in 1962 to $1 trillion and is the twelfth largest after 2017. In 2017, per capita income was $29,745. Services, manufacturing and agriculture account for 54.1%, 26.3% and 2.1% of GDP respectively.

(Source: Bank of Korea). Economic changes were achieved despite Korea`s heavy reliance on imports of natural resources, including crude oil and essential minerals. In 1996, Korea became the 29th member of the Organisation for Economic Co-operation and Development (OECD). Korea is the world`s fifth largest exporter and 9th largest importer from 2017. Exports increased 15.8% to $573.7 billion and imports also decreased 17.8% to $478.5 billion.