India-Republic of Korea: A New Era of Relationship 1

2 India-Republic of Korea: A New Era of Relationship

India-Republic of Korea: A New Era of Relationship 3
“All rights are reserved. No part of this publication may be reproduced, stored in a retrieval system,
or transmitted, in any form or by any means, without the permission in writing of FICCI”

4 India-Republic of Korea: A New Era of Relationship

 Foreword

India and Republic of Korea are two major emerging economies of the Asia-Pacific region
and both have been witness to significant economic reforms in the past two decades. With
good economic fundamentals, both countries have positioned themselves amongst the top
investment destinations in the region. With South Korean President Moon Jae-in’s maiden
visit to India, the relations shall move evne further towards stronger business engagement by
harnessing synergies in our mutual pivots.

Our partnership is broad-based and cuts across various sectors. The recent developments have
laid strong emphasis on Defense manufacturing, Maritime and Shipbuilding, Manufacturing,
Electronics, Infrastructure and Renewable Energy as focus sectors for cooperation between
the two countries. We need to build on these opportunities through bilateral investments.

FICCI has always put a lot of emphasis on this relationship and has been supplementing
Government of India’s efforts through its holistic agenda with Republic of Korea. Our spectrum
of activities with Korea includes engaging with the political leadership, enabling industry
partnerships, nurturing knowledge economy, synergizing with the States and Provinces, and
promoting people to people connect.

On the occasion of the India-Korea Business Forum and the 2nd India-Korea CEOs Forum
meeting, we are delighted to launch this FICCI knowledge paper on “India-Korea: A New
Era of Relationship”. This report aims to present the current status of trade and investment
relations, the regulatory environment, recent developments and scope for future cooperation
between our two countries.

I wish all success to the deliberations and discussions at various business interactions during
this landmark visit.

Rashesh Shah
President
FICCI and Chairman & CEO, Edelweiss Group

India-Republic of Korea: A New Era of Relationship 5

6 India-Republic of Korea: A New Era of Relationship
 Table of Contents

1. Introduction 9

2. Overview of Indian economy and latest developments 10

3. Overview of Korean economy and latest developments 13

4. Overview of economic and commercial relations 16

a) India-Korea CEPA 16

b) Trade relations 17

c) Investment relations 21

d) Korean presence in India 25

5. Some Recent developments 28

5.1 Outcome of recent high level visits 28

5.2 Recent development in Industry relations 31

6. Glimpses of FICCI’s initiatives with Korea 34

7. The Way forward 37

7.1 Key sectors for Industry Cooperation 37

8. Snapshot of the recent developments between India and Korea with 46

highlights on recent regulatory developments and key indicators on
certain state incentives

*This Report has been prepared by EAST ASIA DESK-International Affairs Division, FICCI

India-Republic of Korea: A New Era of Relationship 7

8 India-Republic of Korea: A New Era of Relationship
1 Introduction
The relations between India and South Korea dates back centuries. We are also bound by our
Buddhist traditions. Nobel laureate Rabindranath Tagore composed poem ‘Lamp of the East’
in 1929 about Korea’s glorious past and its bright future.

It is also a coincidence that India and Korea both celebrate their independence day on August
15. From Princess to Poetry and from Buddha to Bollywood; India and Korea have so much in
common. Our partnership has immense potential to promote regional growth, development,
stability and prosperity in Asia. While India is turning to the east for bigger economic
engagement, South Korea is trying to diversify in overseas markets.

With South Korean President Moon Jae-in’s forthcoming maiden visit to India in July 2018,
the relations shall move towards stronger pragmatic engagement with Seoul, harnessing
synergies in their mutual pivots across the Indo-Pacific region.

Similar to Korea, which has announced its “New Southern Policy” aimed at strengthening
ties with Southeast Asian and South Asian countries, India has its “Act East Policy,” which
builds on the previous “Look East Policy,” with a greater emphasis on implementing policies
of comprehensive cooperation.

As Korea expands its diplomatic footprints beyond its immediate region, we have long believed
that India and Korea are bound to be natural partners. It is only natural that India and Korea
-- democracies with similar values, aspirations and capacities -- strengthen their ties on the
political, defense, economic, cultural and people-to-people fronts.1

Given the impetus on India-Korea economic relations, this report aims to present the current
status of trade and investment relations, recent developments in our economic engagements
and scope for future cooperation between our two countries.

Interview by Indian Ambassador to Korea Vikram Doraiswami (Indian Embassy in Korea), May 14, 2018; the Korea
1

Herald accessed at http://m.koreaherald.com/view.php?ud=20180513000279#cb

India-Republic of Korea: A New Era of Relationship 9

 An Overview of the Indian Economy and latest
2
developments undertaken by the Indian Government
Table1: Macroeconomic Indicators for Indian Economy
Macroeconomic Indicators
GDP (Official exchange rate) $2.439 trillion (2017 est.)
GDP – Real Growth rate 6.7% (2017 est.)
GDP- Purchasing Power Parity (PPP) $9.447 trillion (2017 est.)
GDP – Per capita income $7,200 (2017 est.)
Population 1,281,935,911 (July 2017 est.)
GDP – Per capita income $7,200 (2017 est.)
Population 1,281,935,911 (July 2017 est.)
Area total: 3,287,263 sq. kms. country comparison
to the world: 8
Exchange Rate ( Indian Rupee (INR) per US$) 65.17 (2017 est.)
Currency Indian Rupee (INR)
Gold and Foreign Exchange reserve in US$ $407.2 billion (31 December 2017 est.)
Total Trade with ROW (2017 est.) $726.1 billion (2017 est.)
Total Exports (2017 est.) $299.3 billion (2017 est.
Total Imports (2017est.) $426.8 billion (2017 est.)
Inflation 3.8% (2017 est.)
Inward FDI stock (2017 est.) $367.5 billion (31 December 2017 est.)
Outward FDI stock (2017 est.) $156.1 billion (31 December 2017 est.)
GDP Composition (2017 est.)
Agriculture 16.8%
Industry 28.9%
Services 46.6%
Labor Force
Agriculture 47%
Industry 22%
Services 31%

10 India-Republic of Korea: A New Era of Relationship

 Development Indicators

Literacy Rate 71.2%

Human Development Index 0.624

Gini Index 35.2

Ease of Doing business 100

Source: CIA World Fact Sheet

Despite an uncertain global environment, India is performing well. Over the last three years,
the Indian economy has registered an avergae growth of around 7% (7.5% in 2014-15, 8.0%
in 2015-16, 7.1% in 2016-17, 6.7% in 2017-18). The macroeconomic framework of the country
has improved over the past three and half years since 2014 and government has been serious
about pursuing structural reforms.

According to the World Bank’s Ease of Doing Business Report 20182, India’s rank has
leapfrogged 30 spots to 100th position out of 190 nations. The country has improved its ranking
in six out of ten parameters - dealing with construction permits, getting credit, protecting
minority investments, paying taxes, enforcing contracts and resolving insolvency.

This is expected to further promote investor confidence and aid growth in the country. This
along with the Moody’s upgrade of India’s rating is a positive reaffirmation of the various
reform measures undertaken by the government over the last three to four years.

There have been several developments/announcements off late which will augur well for
growth prospects going ahead. Latest projections indicate that the Indian economy will retain
its position of fastest growing economy. Multilateral agencies such as World Bank and Asian
Development Bank have pegged India’s growth for 2018-19 at 7.3%; the Reserve Bank of India
(RBI) in its second bi-monthly monetary policy statement3 estimated growth projection for the
year to be 7.4%, as in the April policy. The country is also witnessing some critical structural
shifts which are expected to push the growth frontier over the course of next few years. India
is at the cusp of a major digital transformation which will bring in massive opportunities. With
this we also expect to see large volume of businesses moving into the formal sector. On the
global front, outlook for growth has improved and trade is also expected to pick up in 2018 and
2019. This is likely to have a salutary impact on India’s overall exports.

RBI in the latest monetary policy assessment (announced June 06, 2018)4 has projected
CPI inflation in the range of 4.7-5.1% in H1: 2018-19 and 4.4% in H2, including the House
Rent Allowance impact for central government employees with risks tilted to the upside.
The government has been vigilant of the price situation and has taken several measures over
time to keep a check on the price levels. The government also gave approval to the public
procurement policy which will give preference to domestically manufactured goods and thus
give a push to the ‘Make in India5’ initiative. The policy will provide a much needed impetus

2
World Bank’s Ease of Doing Business Report 2018 Accessed at http://www.doingbusiness.org/data/exploreeconomies/
india
3
RBI in the latest monetary policy assessment accessed at https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.
aspx?prid=44125
4
RBI in the latest monetary policy assessment accessed at https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.
aspx?prid=44125
5
Make in India Initiative website accessed at http://www.makeinindia.com/home

India-Republic of Korea: A New Era of Relationship 11

to the domestic manufacturing sector by promoting greater indigenization and domestic value
addition. Also, Government of India has recently approved the New Manufacturing Policy with
the objective of increasing the manufacturing share in GDP to 25% and creating 100 million
jobs within a decade.6

As per the latest data, Indian exports during February 2018 have shown a positive growth of
around 4.48% in dollar terms vis-à-vis February 2017. The improvement in external demand
conditions is supporting India’s exports. The International Monetary Fund also said that India
should see its growth picking up this year after two major structural reforms - demonetisation
and GST - while China’s growth is likely to fall gradually. Imports, on the other hand, during
February 2018 were valued at US$ 37,813.57 million (Rs. 243,420.48 crore) which was
10.41% higher in Dollar terms and 5.96% higher in Rupee terms over the level of imports
valued at US$ 34,248.44 million (Rs. 229,723.10 crore) in February 2017 . The reform oriented
approach of government has reinvigorated the interest of foreign investors in India. Foreign
investment inflows into India continue to remain robust. As per DIPP, provisional estimates
for 2016-17 report foreign direct investment inflows at US$ 60.1 billion, an 8.1% increase
over the same period last year. Foreign direct investment inflows into India amounted to US$
45.1 billion in 2014-15 and US$ 55.5 billion in 2015-16. Cumulative foreign direct investment
inflows in the first quarter of 2017-18 amounted to US$ 14.5 billion. Further, the net portfolio
investments have been robust in 2017. However, equity outflows have been noted during
August-September on account of geo-political uncertainties and expected normalization of
federal asset purchases.

The world output and trade volumes are expected to expand in 2018 and 2019. The
improved outlook for global growth and global trade will have a positive impact on India’s
export performance. Further, the mid-term review of the Foreign Trade Policy 2015-20 was
announced7. The policy review is encouraging and extends further support to exporters.

Since 2014, the Government of India has introduced several reform measures and initiatives,
both through the legislative and executive routes. The reforms have been broad-based
encompassing wide range of areas including taxation, subsidies, labour, infrastructure, finance,
investments as well as governance. Various campaigns initiated by Government (Make in India,
Digital India, Smart Cities, Skill India) and measures taken towards ease of doing business
have been encouraging. These programmes offer tremendous investment opportunities. India
has significant inherent strengths - demographic dividend, good natural resource base, huge
consumer market and the government is assiduously trying to leverage these advantages in
the best possible manner.

6
http://dipp.nic.in/sites/default/files/po-ann3.pdf
7
Press Information Bureau Release, Government of India, Ministry of Commerce and Industry accessed at http://pib.nic.
in/newsite/PrintRelease.aspx?relid=174117

12 India-Republic of Korea: A New Era of Relationship

3
An Overview of the South Korean Economy and latest
developments
Table 2: Macroeconomic Indicators for Korean Economy
Macroeconomic Indicators
GDP ( Official exchange rate) $1.53 trillion (2017 est.)
GDP – Real Growth rate 3% (2017 est.)
GDP- Purchasing Power Parity (PPP) $ 2.027 trillion (2017 est.)
GDP – Per capita income $ 39,400 (2017 est.)
Population 51,181,299 (July 2017 est.)
Area total: 99,720 sq. kms.
country comparison to the world : 110
Exchange Rate ( won (KRW) per US$) 1,136.7 (2017 est.)
Currency Won (KRW)
Gold and Foreign Exchange reserve in US$ $374.8 billion (31 December 2017 est.)
Total Trade with ROW (2017 est.) $ 1000.7 billion
Total Exports (2017 est.) $ 552.3 billion
Total Imports (2017est.) $ 448.4 billion
Inflation 1.9% (2017 est.)
Inward FDI stock (2017 est.) $ 193.6 billion
Outward FDI stock (2017 est.) $ 342.4 billion
GDP Composition (2017 est.)

Agriculture 2.2%

Industry 38.8%

Services 59.1%

Labor Force
Agriculture 4.9%
Industry 24.1%
Services 71%
Development Indicators
Literacy Rate
Human Development Index 0.901 (18th rank)
Gini Index 34.1 (2015)
Ease of Doing business 4

Source: CIA World Fact Sheet

India-Republic of Korea: A New Era of Relationship 13

Economic growth of South Korea is projected to remain around 3% through 2019, supported
by stronger export growth and fiscal stimulus that offset the impact of tighter regulations on
housing and mortgage lending, which will slow construction investment. Inflation is projected
to rise toward the 2% target, while the current account surplus narrows to around 4% of GDP.

Fiscal policy is playing a key role in Korea’s income-led growth strategy. The government aims
to boost public employment by 34% during its five-year mandate and shift the composition
of spending away from public investment and R&D and towards social welfare. While public
employment is low compared to other OECD countries, job creation in the public sector
should respond to clearly defined needs and be weighed against its long-term cost. Although
government spending is set to increase more than 7% in 2018, the highest since 2011, the
budget surplus is projected to remain above 2% of GDP.

The Bank of Korea raised its policy interest rate from a record low 1¼% to 1½% in November
2017. With consumer price inflation running below 2%, monetary policy accommodation
can be withdrawn gradually. Monetary policy needs to take into account potential risks to
financial stability, including those stemming from household debt, which rose to 180% of net
household disposable income in 2016. The high debt is a headwind to private consumption.
The government announced a comprehensive strategy in late-2017 that aims to slow the
growth of household debt to less than 8.2% per year, notably by tightening regulations on
lending to households.

Korea is projected to maintain stable growth which is projected to remain close to Korea’s 3%
potential rate, while inflation converges toward the 2% target. The rapid growth of government
spending, in part to expand public employment, will help support domestic demand and
reduce the current account surplus. The easing of geo-political tension related to North Korea
is a positive development, although trade protectionism remains a concern. Another risk to
the projection is the planned 54% hike in the minimum wage during the President’s five-year
term. The higher minimum wage could lead to a faster increase in private consumption to
the extent that it is enforced, but it could also slow employment growth and weaken Korea’s
competitiveness if not accompanied by productivity gains.

Table 3: Korea: Demand, output and prices

2014 2015 2016 2017 2018 2019
Current Percentage changes, volume (2010 prices)
prices
KRW
trillion
GDP at market prices 1 486.1 2.8 2.9 3.1 3.0 3.0
Private consumption 748.2 2.2 2.5 2.6 2.9 2.7
Government consumption 224.7 3.0 4.5 3.4 6.0 3.9
Gross fixed capital formation 433.3 5.1 5.6 8.6 4.0 2.3
Final domestic demand 1 406.2 3.2 3.8 4.7 3.8 2.7
Stockbuilding 1
1.8 0.7 0.0 0.4 0.2 0.0
Total domestic demand 1 408.0 3.9 3.8 5.1 3.9 2.7
Exports of goods and services 747.1 -0.1 2.6 1.9 3.5 4.3
Imports of goods and services 669.1 2.1 4.7 7.0 5.5 3.7
Net exports 1
78.1 -1.0 -0.7 -1.7 -0.6 0.4

14 India-Republic of Korea: A New Era of Relationship

 2014 2015 2016 2017 2018 2019
Current Percentage changes, volume (2010 prices)
prices
KRW
trillion
Memorandum items
GDP deflator _ 2.4 2.0 2.3 1.0 2.3
Consumer price index _ 0.7 1.0 1.9 1.6 2.0
Core inflation index2 _ 2.4 1.9 1.5 1.5 2.0
Unemployment rate (% of labour force) _ 3.6 3.7 3.7 3.8 3.7
Household saving ratio, net (% of _ 9.3 8.7 8.9 8.9 8.9
disposable income)
General government financial balance (% _ 1.3 2.4 2.8 2.1 1.9
of GDP)
General government gross debt (% of GDP) _ 45.7 45.1 44.5 44.2 44.5
Current account balance (% of GDP) _ 7.7 7.0 5.1 4.0 4.5
1. Contributions to changes in real GDP, actual amount in the first column.
2. Consumer price index excluding food
and energy.

Source: OECD Economic Outlook 103 database.

Korea’s New Southern Policy

In 2017, President Moon Jae-in announced the New Southern Policy. Under this policy direction,
Korea is looking beyond Northeast Asia to deepen bonds of cooperation with ASEAN and
South Asia including India. By forging a mutually beneficial partnership, the policy’s ultimate
goal is to contribute to an even better quality of life for the people of both South-east Asia and
Korea -- and in so doing fostering a peaceful community of prosperity.8

The focus of this policy mainly lies in the following segments:

• Elevate the levels of diplomacy and closeness with the states in southern region,
including Southeast Asia (ASEAN), South Asia (India), and Australasia (Australia and
New Zealand)
• Under the New Southern Policy, the agendas are tied to Northeast Asia Plus Community
of Responsibility’s (NAPCOR) goal of ‘national security through peace’.
• Thus, the major pillars include economic cooperation, peace diplomacy, and mediating
conflict through multilateralism

8
Article on New Southern Policy, Korean Herald, May 8, 2018 accessed at http://www.koreaherald.com/view.
php?ud=20180507000211

India-Republic of Korea: A New Era of Relationship 15

4
India-Korea Relations: Overview of Commercial and
Economic Cooperation
India and Korea are the third and fourth largest economies in Asia and share a strong bond of
friendship based on shared commitment to the values of democracy, open society and liberal
international economic order.9

The bilateral trade in 2017 grew by 30 percent on both sides from the previous year, reversing
a negative trend that had started in 2011, according to Korean official statistics cited by the
Indian Embassy in Seoul. Investment flows have gained momentum, with Korean firms having
plowed nearly $3.5 billion in the last three years into India’s automobiles and auto components,
electronics, chemicals, technical textiles, food processing, finance and other industries.

Korea created and sustained their global brands, from information technology and electronics
to automobile and steel, Korea has given exemplary products to the world. South Korean
companies are appreciated for their innovation and strong manufacturing capability. Korean
electronics manufacturers have become household names in India and touch millions of lives
each day.

India and South Korea want to grow together by complementing each other’s strength and
by joining hands. India has skills and South Korea has manufacturing experience. By merging
these two qualities the two countries can enter markets in third countries.

The Comprehensive Economic Cooperation Agreement (CEPA) signed between the two
countries provides an excellent platform for expanding the bilateral trade, which is currently
below its potential, and also give great impetus for flow of investment both ways.

The momentum created by mutual visit of Prime Minister Narendra Modi and the forthcoming
maiden visit of President Moon Jae-In is now accelerating with commitments from
both countries to build a lasting economic relationship. Perhaps as a lead to this new era
in relationship, the Export-Import Bank of Korea is pursuing a $10 billion plan to support
infrastructure development pan India.10

a) India-Korea CEPA
The CEPA between India and the Republic of Korea is the first such free trade agreement
signed by India with an OECD country. It was signed in August 2009 after over three years of
negotiations and came into effect on January 1, 2010. It is an agreement between two countries
at different stages of development. Korea on the one hand is an export led industrialised
country with a strong manufacturing base. India, on the other, is a fast developing emerging

9
Suresh Parbhu’s twet accessed at https://www.indiatvnews.com/business/news-pm-modi-speech-at-india-korea-
business-summit-2018-live-updates-make-in-india-investments-smart-cities-infrastrcuture-430077
10
Accessed at https://economictimes.indiatimes.com/news/economy/finance/india-korea-business-summit-make-in-india-
gets-a-leg-up-from-south-korean-honchos/articleshow/50572466.cms

16 India-Republic of Korea: A New Era of Relationship

economy with a large domestic market but whose external trade measures are much smaller
in relation to its GDP.

Broadly, CEPA provides for a more liberalised bilateral framework in trade in goods, services
and investment.11

While there has been appreciating growth in bilateral trade from US$ 12 billion in 2010 to
over US$ 20 billion, the issue of widening trade deficit is a matter of concern for long term
sustainability and both countries would need to work towards a mutually beneficial and a more
balanced trade in future.

The two countries are currently in the final stage of negotiation to upgrade the Comprehensive
Economic Cooperation Agreement -- a bilateral free trade agreement that entered into force
in 2010 -- with an aim to improve the competitiveness of each side’s goods and services
in their markets, and spur synergies in information technology and electronics, energy and
shipbuilding.

The agreement has facilitated the opening of both economies’ services market. On the Indian
side, telecommunications, construction, distribution, transportation, accounting, real estate,
health care and other sectors have opened, while on the Korean side, consulting, education,
engineering and computer science have been liberalized.

The preferential tariffs which were in the progressive elimination categories have now become
fully operational, as a result of which about 70% of tariff lines in Indian schedule and 88% of
the lines in Korean schedule are already at zero duty under CEPA.

As part of efforts to augment bilateral strategic relationship, India and Korea are working to
establish a future strategy group under which joint projects will be taken up in the areas of new
technologies such as artificial intelligence, Internet of Things, future manufacturing, robotics
and green tech.12

b) Trade Relations
The bilateral trade between India and South Korea in 2017 reached $20 billion, the first time
in six years.13 According to the New Southern Policy, Korea significantly gained high priority to
expand its bilateral trade and investment ties with India. India’s share in Korea’s global imports
increased from 0.78% to 1.03% in 2015-16, while on the other hand India’s contribution in
Korea’s global trade was around 1.75% in 2017.

11
Report on “India-Korea CEPA: An Appraisal of Progress”; VS Sheshadri, 2015
12
Article on “India-Korea for an early conclusion of CEPA review”; Economic Times, Feb 27, 2018
13
PM Modi’s speech at the 2nd India Korea Business Summit held in New Delhi, Feb 2018 https://www.business-
standard.com/article/economy-policy/india-south-korea-bilateral-trade-touched-20-bn-in-2017-pm-modi-118022700528_1.
html

India-Republic of Korea: A New Era of Relationship 17

Table 4: India-Korea Bilateral Trade Values in US $ Millions
S. No. Year 2013-2014 2014-2015 2015-2016 2016-2017 2017-2018
1. EXPORT (to South Korea) 4,208.69 4,602.95 3,522.64 4,241.42 4,460.98
2. %Growth 9.37 -23.47 20.40 5.18
3. India's Total Export 314,405.30 310,338.48 262,290.13 275,851.71 303,376.22
4. %Growth -1.29 -15.48 5.17 9.98
5. %Share 1.34 1.48 1.34 1.54 1.47
6. IMPORT (from South Korea) 12,470.60 13,529.11 13,047.12 12,585.35 16,361.76
7. %Growth 8.49 -3.56 -3.54 30.01
8. India's Total Import 450,199.79 448,033.41 381,006.63 384,355.56 465,578.29
9. %Growth -0.48 -14.96 0.88 21.13
10. %Share 2.77 3.02 3.42 3.27 3.51
11. TOTAL TRADE 16,679.28 18,132.06 16,569.77 16,826.78 20,822.74
12. %Growth 8.71 -8.62 1.55 23.75
13. India's Total Trade 764,605.09 758,371.89 643,296.75 660,207.28 768,954.51
14. %Growth -0.82 -15.17 2.63 16.47
15. %Share 2.18 2.39 2.58 2.55 2.71
16. TRADE BALANCE
17. India's Trade Balance -135,794.49 -137,694.93 -118,716.50 -108,503.85 -162,202.06
Note: Since 2006-07, Petroleum figures are being computed from Import Daily trade Returns (DTRs) to generate
country-wise/port-wise tables. Up to 2005-06 consolidated petroleum import figures were being received from the
Petroleum Ministry.

Analyzing what India exported to Korea from 1999-2000 till 2017-18, the major heads are
mineral fuels, oil, distillation products, Iron and Steel, organic chemicals, machinery, nuclear
reactors, boilers, vehicles other than railway tramway, ores, slag and ash, etc. The exports
from India to Korea reached at significant peak of US$ 4,460.98 million in 2017-18. However,
the imports are growing faster than exports. The table listed above clearly depicts that rate
of growth in Indian imports from Korea is around 30% whereas the rate of growth of exports
from India to Korea stood at 5.18%. The reasons behind this could be the impact of GST
implementation (one nation, one tax) on July 1, 2017 and lack of proper transport infrastructure
facilities etc. India’s major exports to RoK have been primary products, listed below:
Table 5: Top 10 items of India’s exports to South Korea In US$ Million
S. No. HS Code Commodity 2015-2016 2016-17 2017-18
1 27 Mineral Fuels, Mineral Oils and Products of their Distillation; 557.37 975.43 768.58
Bituminous Substances; Mineral Waxes
2 76 Aluminium and Articles Thereof 538.89 748.79 764.63
3 29 Organic Chemicals 316.43 349.49 374.31
4 72 Iron and Steel 236.32 334.04 339.15
5 52 Cotton 194.39 191.92 203.26
6 84 Nuclear Reactors, Boilers, Machinery and Mechanical 158.17 139.36 182.20
Appliances; parts thereof.
7 23 Residues And Waste from the Food Industries; Prepared 125.88 91.91 103.67
Animal Foder
8 75 Nickel and Articles Thereof 94.3 7.18 0.93
9 85 Electrical Machinery and Equipment and Parts thereof; Sound 89.93 81.06 102.60
Recorders and Reproducers, Television Image and Sound
Recorders and Reproducers, and Parts
10 79 Zinc and Articles thereof 88 93.36 161.74
Source: Ministry of Commerce, Government of India

18 India-Republic of Korea: A New Era of Relationship

The major items exported to South Korea comprises of mineral fuels, mineral oils and products
of their distillation; bituminous substances, mineral waxes, aluminium articles thereof , iron
and steel , cotton etc. However, the exports of mineral fuel, mineral oils and products of
their distillation have shown a declining trend from US$ 975.43 million in 2016-17 to US$
768.58 in 2017-18 and that of nickel and articles thereof from US$7.18 million in 2016-17
to US$0.93 million in 2017-18. On the other side, the exports of other products, especially,
nuclear reactors, boilers has increased significantly from US$ 139.36 million to US$ 182.20 in
2017-18. Similar upward trend has been seen for zinc, electrical machinery and equipment,
and cotton etc. in 2107-18.

Table 6: Top 10 items of India’s imports from South Korea

S. No. HS Code Commodity 2015-2016 2016-17 2017-18
1 85 Electrical Machinery and Equipment and Parts thereof; Sound 2,807.58 2,815.89 2722.48
Recorders and Reproducers, Television Image and Sound
Recorders and Reproducers, and Parts
2 72 Iron and Steel 1,877.16 1,507.91 2257.54
3 84 Nuclear Reactors, Boilers, Machinery and Mechanical 1,605.96 1,507.38 1600.68
Appliances; Parts thereof
4 39 Plastic and Articles thereof 1,272.95 1,230.31 1540.92
5 27 Mineral Fuels, Mineral Oils and Products of their Distillation; 691.77 677.99 922.96
Bituminous Substances; Mineral Waxes
6 87 Vehicles other than Railway or Tramway Rolling Stock, and 660.2 677.97 737.51
Parts and Accessories thereof
7 29 Organic Chemicals 596.07 703.24 1052.22
8 90 Optical, Photographic Cinematographic Measuring, Checking 340.57 316.80 347.59
Precision, Medical or Surgical Instruments and Apparatus
Parts and Accessories thereof
9 71 Natural or Cultured Pearls, Precious or Semiprecious Stones, 311.26 309.55 1441.03
Precious Metals, Clad with Precious Metal and Artcles
Thereof; Imitation Jewlry; Coin
10 40 Rubber and Articles thereof. 298.24 283.98 351.57

Source: Ministry of Commerce, Government of India

India is a major importer of iron and steel, nuclear reactors boilers, machinery and mechanical
appliances and parts thereof and organic chemicals etc. from South Korea. The imports from
South Korea has increased and reached a great height especially in last two years. Major
increase is seen in imports of iron and steel from US$1,507.91 million in 2016-17 to US$
2257.54 million in 2017-18 and of natural or cultured pearls precious or semiprecious stones
from US$309.55 in 2016-17 to US$1441.03 in 2017-18. The imports of products such as
organic chemicals, rubber and articles thereof and plastic and thereof etc. also show a rising
trend in 2017-18.

India-Republic of Korea: A New Era of Relationship 19

Table 7: Top 5 Competitors of India’s Top 5 Exports (As on Jan 2017)
S. No. Commodity Competitors Amount
(In millions of
US$)
1. Saudi Arabia 1,333
2. Qatar 1,057
Mineral Fuels. Mineral Oils, Bituminous Substances,
1 3. Australia 863
Mineral Waxes (HS Code: 27)
4. Iran 771
5. Kuwait 735
1. Australia 66
2. Pr.China 57
Aluminium and Articles thereof
2 3. U.S.A 43
(HS Code: 76)
4. Canada 30
5. Russia 27
1. Pr.China 208
2. Japan 193
Organic Chemicals
3 3. U.S.A 144
(HS Code: 29)
4. Germany 84
5. Taiwan 32
1. Pr.China 613
2. Japan 383
Iron and Steel
4 3. Taiwan 46
(HS Code: 72)
4. Russia 40
5. U.S.A 31
1. Brazil 21
2. Pr.China 20
Cotton
5 3. U.S.A 17
(HS Code: 52)
4. Viet Nam 9
5. Pakistan 5

Significant trends (As on Jan 2017)

Details of significant trends Analysis
In January 2017, Korea’s exports surged 11.2% to US$ The double-digit growth in exports was driven by strong
40.3 billion in January from a year earlier, marking the performances of Korea’s major export products, especially
first double-digit growth since January 2013. Imports semiconductors, petroleum products and petrochemicals.
increased 19.7 % to $37.5 billion in January, compared to The combined outbound shipments of the 13 major
a year ago. The monthly trade balance came to a surplus products, which accounts for 79 % of the total exports, rose
of $2.8 billion, marking the 60th months of surplus. by 12.8 %, the fastest pace in 59 months since February
2012. It also marks the second consecutive month of
Bilateral trade in January 2017, ROK’s export to India growth for the first time in 30 months since July 2014. Eight
marked US$1,114 million, 27.1 % rose year on year of the 13 product groups recorded a growth in exports, with
and import from India amounted US$383million, 21.1% four of them a double-digit rate. They are semiconductors,
increased year on year, posting US$731 million trade petroleum products, petrochemicals, flat-panel displays,
surplus with India. general machinery, steel, computers and parts, and
automobile parts.
Among the top 10 items importing from India in January
2017, most of the items were on the upturn. Mineral
fuels, mineral oils, etc. (HS Code: 27) rose heavily,
183.4% year on year, marking US$124 million and shared
32.4% of the total imports. Import of Organic chemicals
(HS Code: 29) and Iron and Steel (HS code: 72) also rose
20.4% and 26.4%. Zinc and Articles thereof (HS Code:
79) surged 79.7%, amounting to US$11.

20 India-Republic of Korea: A New Era of Relationship

 Details of significant trends Analysis
The items on the downturn are Nuclear reactors, Meanwhile, ships, home appliances, wireless communication
Boilers, Machinery, and Mechanical appliances parts devices, automobiles and textile posted declines. Exports of
thereof (HS Code: 84) which dropped slightly 4.3%, ships dropped 17.5 % to $2.2 billion, with Korean manufacturers
posting US$16 million and shared 4.2% of the total exporting a total of 26 ships including one liquefied natural
imports. Electrical machinery and equipment and gas carrier and one ethane multi-gas carrier. The discontinued
parts thereof (HS Code: 85) also dropped 18.8% Samsung Electronics Galaxy Note 7 continues to influence
amounting US$ 8 million. outbound shipments of wireless communication devices, which
fell 17% to $1.8 billion in January. Automobile exports dropped
Among the top ten items exporting to India, in
4.7 % to $2.9 billion due to one fewer working day in the month
January 2017, most of the items rose heavily.
that celebrated the Lunar New Year’s holiday as well as the
Electrical machinery and etc. (HS Code: 85) sharply
absence of new vehicle models leading to lower global sales.
rose 85.6% year on year, amounting to US$ 307
Textile exports inched down 2.2 % to $979 million,
million and shared 27.6% of the total exports.
Nuclear reactors, boilers etc. (HS code: 84), Organic By country, exports to Vietnam, other South East Asian
Chemicals (Hs Code: 29) and Mineral Fuels, etc. countries, China, Japan, the European Union, Commonwealth of
(Hs Code: 27) also increased 41.4%, 58.1%, 65.2% Independent States, and India continued to rise while sales to the
respectively. On the other hand, Vehicles other than Middle East made a turnaround to growth.
railway or tramway rolling-stock, and parts thereof
The Ministry of Trade, Industry and Energy (MOTIE) projected
(HS Code: 87) dropped 16.3% amounting to US$ 54
that the recovery of Korea’s exports to continue in February with
million.
increases in exports volume and prices of main products.

c) Investment Relations
Korea ranks 16th in terms of FDI equity inflows to India with investments of $2.26 billion
between March 2000 and April 2017. More than 500 Korean companies, including Samsung,
LG and Hyundai, have operations in India.14

India offers a lot of potential for Korean Investors with its huge market and enabling policy
environment. In FDI, India is one of the most open countries now. Most of the sectors of the
economy are open for FDI and more than 90% FDI approvals have been put on automatic
route. There is no requirement of government approval for investments in manufacturing
sector except for the defence sector.

Korean FDI to India (December 2017) stood at US$ 2558.90 million, as per the DIPP Quarterly
Fact Sheet on FDI, of which $131 million was received in 2010, $244 million in 2011, $223
million in 2012, $173 million in 2013, $146 million in 2014, $245 million in 2015 and $465.64
million in 2016. The world’s fourth largest steel maker POSCO proposes to invest $12 billion
in an integrated steel plant in Orissa. POSCO has also completed construction of its first steel
mill in Maharashtra and set up another JV with Uttam Galva Group. The former entailed a total
investment of $ 240 million for galvanized plate facility, whose production would cater to high-
end galvanized needs of automakers in and around Pune besides those of home appliances
companies.

Accessed at http://www.thehindu.com/business/Economy/india-one-of-the-most-open-economies-says-narendra-modi-
14

at-india-korea-business-summit/article22865134.ece

India-Republic of Korea: A New Era of Relationship 21

Table 8: Financial Year wise FDI inflow from South Korea and all countries

Financial Year FDI equity inflows from South FDI equity inflows from all Total FDI inflows
(April-March) Korea Countries* (including equity, re-
invested earnings &
other capital)**
Rs. in crores US$ in million Rs. in crores US$ in Million (US$ in million)
2000-01 89.57 20.67 10,733 2,463 4,029
2001-02 4.50 1.00 18,654 4,065 6,130
2002-03 187.74 39.17 12,871 2,705 5,035
2003-04 109.94 23.90 10,064 2,188 4,322
2004-05 157.04 34.56 14,653 3,219 6,051
2005-06 269.05 60.18 24,584 5,540 8,961
2006-07 321.20 70.89 56,390 12,492 22,826
2007-08 404.10 99.52 98,642 24,575 34,843
2008-09 494.92 114.64 142,829 31,396 41,873
2009-10 778.68 166.88 123,120 25,834 37,745
2010-11 600.89 131.35 97,320 21,383 34,847
2011-12 ^ 1,183.84 244.79 165,146 35,121 46,556
2012-13 1,219.69 223.99 121,907 22,423 34,298
2013-14 1,061.29 173.85 147,518 24,299 36,046
2014-15 892.57 146.54 189,107 30,931 44,291
2015-16 1615.8 245.85 262,322 40,001 -
2016-17 3133.42 465.54 291,696 43,478 -
2017-18(up to Dec 1902.94 295.58 231,457 35,941 -
2017)
Cumulative Total 14427.18 2558.90 2,019,013 368,054 -
(April 2000-
December 2017)

Table 9: Details of Top FDI Inflows received into India (Remittance wise)
(through Indian companies, from April 2000 to September 2015):
S. Name of Indian FDI Name of RBI Regional Item of Amount of FDI
No. Company Route Foreign Office Manufacture Inflows
Collaboration (In Rs. In US$
Crore) Million
1 Max Healthcare RBI TEDO New Delhi Health and medical 516.5 83.43
Institute Ltd. Beleggings 163 services
Proprietory Ltd.
2 POSCO RBI POSCO Mumbai Manufacture of 394.55 80.25
Maharashtra machine tools, their
Steel Pvt. Ltd. parts & accessories
3 POSCO RBI POSCO Mumbai Manufacture of iron 252.45 46.34
Maharashtra & steel in primary/
Steel Pvt. Ltd. semi-finished forms
in mini steel plants
(includes re-rolling
4 POSCO RBI POSCO Mumbai Manufacture of iron 240.79 52.56
Maharashtra & steel in primary
Steel Pvt. Ltd. forms n.e.c.
5 POSCO India RBI POSCO Bhubaneshwar Other manufacturing 225.00 48.96
Pvt. Ltd. industries

22 India-Republic of Korea: A New Era of Relationship

S. Name of Indian FDI Name of RBI Regional Item of Amount of FDI
No. Company Route Foreign Office Manufacture Inflows
Collaboration (In Rs. In US$
Crore) Million
6 POSCO India RBI POSCO Bhubaneshwar Manufacture of iron 225.00 41.08
Pvt. Ltd. & steel in primary
forms n.e.c.
7 POSCO India RBI TAE Hyun Bhubaneshwar Semi finished iron & 225.00 50.2
Pvt. Ltd. Jeongl & Posco steel products n.e.c.
8 POSCO RBI POSCO Mumbai Manufacture of iron 202.06 36.37
Maharashtra & steel in primary
Steels Pvt Ltd forms n.e.c.
9 Mobis (I) Ltd. RBI Hyundai Mobis Chennai Mfr. Of internal 160.92 34.74
Co. Ltd. combustion piston
engines and other
parts & accessories
10 Mirae Assest RBI Mirae Asset Mumbai Real estate activities 119.23 27.77
Global Investment
Investment Management
Mgt.I.P.L Co Ltd
11 Samsung India FIPB Samsung Region Not 114.77 23.91
Electronics Ltd. Electronics Co. Indicated
12 POSCO Electrical RBI POSCO Mumbai Manufacture of iron 114.28 20.98
Steel India Pvt & steel in primary/
Ltd semi finished forms
in mini steel plants
(includes re-rolling
13 Myoung Shin RBI MS Autotech Chennai Manufacture of 109.21 17.70
India Automative co ltd internal combustion
Pvt. Ltd. piston engines
and other parts &
accessories n.e.c. for
heavy motor
14 Doosan Chennai RBI Doosan Heavy Chennai Manufacture of 103.89 20.05
Works Pvt Ltd Industries & boilers & steam
Constrn Co Ltd generating plants
15 Pioneer Gas RBI Korea Western Region Not Power plants 100.61 19.99
Power Ltd. Power Co. Ltd. Indicated
16 Doosan Chennai RBI Doosan Heavy Chennai Manufacture of parts 91.3 18.57
Works P Ltd Industries & & accessories n.e.c.
Constrn Co Ltd for prime movers,
boilers steam
generating & plants
& nuclear
17 POSCO India Pvt RBI POSCO Bhubaneshwar Mining of iron ore 90.00 20.28
Ltd
18 Pyung Hwa India RBI Pyung HWA Chennai Manufacture of 88.42 14.52
Pvt Ltd Holdings Co Ltd transport equipment
& parts
19 Hyundai RBI Hundai Heavy Mumbai Construction 86.02 21.32
Construction Industries Co machinery n.e.c.
Equipment India Ltd
P.L
20 Myunghwa RBI Myunghwa IND Chennai Manufacture of 73.9 11.59
Automotive India Co Ltd internal combustion
Pvt Ltd piston engines
and other parts &
accessories n.e.c. for
heavy motor

India-Republic of Korea: A New Era of Relationship 23

S. Name of Indian FDI Name of RBI Regional Item of Amount of FDI
No. Company Route Foreign Office Manufacture Inflows
Collaboration (In Rs. In US$
Crore) Million
21 Mando RBI Mando Chennai Manufacture of parts 70.29 11.85
Automotive India Corporation and accessories
Ltd n.e.c. for transport
equipment n.e.c.
22 Mirae Asset RBI Mirae Asset Mumbai Real estate activities 69.91 17.47
Global Investment
Investment Mgt Mgt Co. Ltd.
(I) P.
23 Hyosung T & RBI Hyosung New Delhi Manufacture of 67.0 10.30
D India Private Corporation electric power
Limited distribution
transformers,
arc- welding
transformers,
fluorescent ballasts
24 POSCO RBI POSCO Mumbai Manufacture of iron 66.69 14.77
Maharashtra & steel in primary
Steels Pvt. Ltd. forms n.e.c.
25 Parry FIPB Lotte Region Not Buy, sell, 64.48 14.02
Confectinery Ltd Confectionery Indicated import/ export of
Co Ltd confectioneries
Grand Total 3,872.27 759.00

Table 10: Share of Top Sectors Attracting FDI Equity inflows from South Korea

Rank Sector Amount of FDI equity inflows % age of FDI equity inflows
from South Korea
Rs. in crores US$ in million
1 Metallurgical Industries 1,831.16 357.90 21.43
2 Automobile Industry 1,083.02 196.26 11.75
3 Prime Mover (Other Than Electrical 690.74 144.70 8.66
Generators)
4 Machine Tools 555.93 110.68 6.63
5 Hospital & Diagnostic Centres 549.48 89.09 5.33
Total of Above

Source: FDI Country note on KOREA from DIPP

Indian Investment to Korea

In past couple of years the share of Indian investment in Korea has increased as evident from
the table below, i.e., FDI inflows from India into Korea have gone up and ROK is increasingly
becoming one of the most attractive destinations for Indian investors. The overall investment
scenario in Republic of Korea appears to be encouraging. Indian investments in RoK is estimated
to be about US$ 3 billion.

24 India-Republic of Korea: A New Era of Relationship

Table 11 : India FDI in South Korea

Indian FDI in S. Korea • Indian FDI led by Mahindra & Mahindra (Ssangyong Motors),& TATA (Tata Daewoo
commercial vehicles)
India – Korea Mahindra & Mahindra
Automotive
• Acquired Ssanyong Motor (US$ 460 million (2011) and US$ 70 million (2013)).
collaboration
“SsangYong” - the name means double dragon
• Purpose - Secure global network of Ssayong Motor
• 2015 promises to be another landmark year for SsangYong with the launch of X100, the
brand’s first small B-segment crossover. Engineered in partnership with Mahindra and
powered by an all-new family of SsangYong designed 1.6 litre petrol and diesel engines,
X100 will be the cornerstone of SsangYong’s future product development.
Tata Motors
• Acquired Daewoo Motor (US$ 120 million (2004))
• Purpose - Diversifying manufacturing model (heavy truck), secure technology
• The two organizations had tremendous synergies in terms of product strategy and R&D.
• Tata is leveraging on the strong presence of Tata Daewoo Commercial Vehicle (TDCV) in
the heavy-tonnage range to introduce products in India and Internationally.
• TDCV has launched several new products in the Korean market, while also exporting
these products to several international markets. Today two–thirds of heavy commercial
vehicle exports out of South Korea are from Tata Daewoo.
Indian IT majors in • Indian IT majors including Tata Consultancy Services (TCS), WIPRO, L&T Infotech,
Korea Mahindra Satyam and Nucleus Software have set up operations in RoK and have been
serving both Korean and other foreign clientele in this country.
Indian Banks in Korea • Indian Overseas Bank and State Bank of India are present in Korea.

d) Korea’s Presence in India

Major Korean conglomerates which have invested in India are Hyundai Motors which has set
up an automotive plant in Chennai with a capacity to produce more than 650,000 cars annually;
Samsung Electronics with centres in Delhi and Bengaluru, LG Electronics, Hyundai Mobis,
Visteon Automotive Systems, and Doosan Corporation. Sector-wise, metallurgical industries
command 21.43% of FDI inflows followed by the automobile industry with 11.75%.

According to Korea Trade Investment Promotion Agency (KOTRA), about 88% of all Korean
subsidiaries established in India are wholly-owned while approximately 11.3% are joint
ventures. Korean enterprises, including Hyundai Motors, LG, Samsung and POSCO have
wholly owned subsidiaries with large scale investments which have allowed them to operate
on economies of scale, establish their brand image at early stage, and gain negotiating power
with local government. The Korean model of investment of working through wholly-owned
subsidiaries is in contrast with the Japanese model which followed the typical process of
technical tie ups € participation as minority stake holders € expansion of stakes.

According to statistics of KOTRA and Korean Exim Bank, Korean investment in India is
concentrated mainly in the manufacturing sectors which accounts for 85.4%, with wholesale
and retail trade 6%, financial and insurance activities 1.1% and electricity, gas, steam and
water supply 1.7%. Major centres of investment are NCR (Delhi, Noida, Gurgaon), Chennai,
Mumbai /Pune. USA continues to be Korea’s main investment destination with a total of US$
63 billion; and China its main destination in Asia with an overall investment of about US$52.1
billion. (Source Exim Bank, Korea). Korea’s other major investment destinations are: Hong
Kong - US$ 17.8 billion and Vietnam - US$ 12.7 billion. The average investment in India during
the last four year period (2012-2015) was US$ 323.2 million/year.

India-Republic of Korea: A New Era of Relationship 25

Table 12 : Major Korean Companies in India (State wise)

Area No of Companies Sector Major Companies

NCR Area 164 Electronics 33 LG Electronics, Samsung Electronics, Hyundai
Construction 31 Motors, Doosan Heavy, Ssangyong E&C, POSCO

Automobile 27
Trade 22
Others 51
Chennai 172 Automobile 102 Hyundai Motors, Lotte Confectionary, Lotte E&C,
Construction 15 Samsung Electronics, Mando

Electronics 15
Trade 15
Others 25
Mumbai/ 79 Manufacturing 32 Hyundai Heavy Shinhan Bank, LG Electronics,
Pune Wholesale & Retail 13 Samsung C&T, Hyundai Merchant Maritime, Hanjin
Shipping
Transportation 11
Construction 6
Others 17
Bengaluru 31 R&D 11 Samsung Research, LG Soft, Hyundai Rotem,
Manufacturing 11 Doosan Infracore, KIST, Korea IT Industry
Promotion Agency
Wholesale & Retail 3
Others 6

Source: Make in India: Contribution of Korean Companies

In addition, while Korean SMEs brought in the first wave of investments in India in the year
1994, it is mostly the large Korean companies that dominate at present. There is tremendous
scope for Korean SME companies to come to India once again and bring in their valuable
experience which can be shared with the Indian counterparts.

Table 13: Prominent South Korean Investors in India

Hyundai Motor India • 2nd largest car manufacturer of India; Annual capacity in India – 680,000 per year; Rolled
(HMI) out 5th million car in October 2013
• Investment in India – US$ 2.7 billion;
• Employment - 9500 employees; total employment – 1.5 lacs (HMI + vendors + dealers +
service)
• Tax Contribution ~ US$ 7.4 Billion
• Yearly turnover – US$ 5 billion;
• HMI Sales - 62% domestic; 38% exports;
• Exports - largest passenger vehicle exporter in India; No. of Countries exporting to 123;
export growth – 46%;; export sales – 2.2 million; export earning – US$ 12 billion
• ‘Elite i20’ won Indian Car of the Year Award (ICOTY) 2015 Award
• HMI new plant in Sriperumbudur, Tamil Nadu ranks number one in terms of productivity
and quality according to Bo Shin Seo, CEO& MD, HMI. “Hyundai has plants in China,
Russia, Brazil, the US (Alabama), Turkey and Czech Republic and in terms of operational
average productivity ratio we are number one. HMI’s second plant makes two models
and routinely hits average productivity ratio of upwards of 99.7%.”
• HMI R&D - Objectives - Establish the Global R&D Network & utilize Indian engineering
manpower; 80% of Indian employees are trained in Korea to enhance skill level
• Hyundai Motor India Foundation contributes Rs. 100 for every car sold towards corporate
social responsibility (CSR) initiatives

26 India-Republic of Korea: A New Era of Relationship

LG & Samsung • Emerged as the topmost trusted brands in India (The Brand Trust Report, India Study
2015)
LG
• LG Electronics is targeting a turnover of US$ 3.65 billion this year in India as part of a
strategy to make the country among the South Korean major’s top three markets in three
years’ time. LG Electronics India had clocked a turnover of US$ 2.9 billion in 2014
• LG Electronics plans to invest US$ 156 million to boost marketing, R&D in India
Samsung
• Samsung Electronics has two factories - in Noida and Tamil Nadu, where it makes 90%
of the handsets it sells in the country - and three R&D facilities. Employment - 45,000;
company has invested US$ 80 m for the expansion of the Noida plant.
• Samsung Electronics is considering setting up its third manufacturing plant in India to
make smartphones & other electronic goods; Investment – US$ 500 million to US$ 1
billion
• Samsung R&D Institute India - Bengaluru (SRI-B) is the largest R&D centre outside Korea
for Samsung Electronics; 3000+ engineers; more than 100 granted patents in India;
Recognized as a key development center for 3G wireless technology, among Samsung’s
global labs.
Lotte India • Lotte India Corporation Ltd (LICL) has two factories in Tamil Nadu and dedicated Sub-
Contracting units in Kerala and Maharashtra.
• Planning to set up a snack and confectionery products manufacturing unit at IMT Rohtak,
Haryana; Unit will be developed over 24,500 m2 area and will entail an investment of
US$ 47 million. The company is expected to commission the project by July 2015.
POSCO • Firmed up plans to invest 20 million US$ (Rs. 123 crore) in building a steel coil mill in
Gujarat (during Vibrant Gujarat).
• The company already holds about 26 percent equity in POSCO Poggenamp Electrical
Steel Pvt Ltd that has operations in Gujarat.
• India’s Mesco Steel has signed an initial agreement with POSCO to set up a plant that
would use the South Korean steelmaker’s finex technology to make steel.
Mando Automotive • Auto components maker Anand merged two joint venture (JV) entities formed with
Korea’s Mando Corporation into one company known as ‘Mando Automotive India Ltd.’
• Mando Automotive India has recently set up a full-fledged global design centre known
as Mando Softtech India for designing brakes, shock absorbers and steering to cater to
the requirements of Mando globally. MSI is R&D centre specialized in electronic control
field.

Samsung C&T • In 2014, Samsung C&T has signed a contract with Reliance Industries Limited (RIL) for
Corporation the construction of the Dhirubhai Ambani International Convention and Exhibition Centre
(DAICEC) in Mumbai, India with contract amount of US$ 678 million.
• This will be the largest International Convention and Exhibition Centre in India.

SHOP-CJ • Shopcj.com is an online shopping site in India launched by SHOP CJ Network Private
Limited (formerly known as STAR CJ Network India Private Limited)., which is a 50:50
joint venture between the South Korean home shopping major, CJ O Shopping Co. Ltd.
and the P5 Asia Holding Investments (Mauritius) Limited belonging to the Providence
Equity Partners group.
• US$ 100 million investment in India; 672 product suppliers
• Launched operations in India in September 2009; 5 million + customers in Oct 2013;
Reaching 60 Million Households through DTH & CATV

India-Republic of Korea: A New Era of Relationship 27

5 Some Recent Developments
The relations between India –Republic of Korea has made great headway in the recent years
and has become multifaceted, aroused by remarkable convergence of interests. India carries
substantial economic & geographical essence for South Korea. It acts as a pathway for Korean
businesses to comprehend the Middle East and African markets, by taking into account its
extensive and ancient involvement with these two regions.

5.1 Outcome of recent high level visits

Building on Prime Minister Modi’s landmark visit to Seoul in 2015, nearly all of India’s senior
ministers have visited Korea over the last 3 1/2 years. They include the ministers of external
affairs; finance; defense; commerce and industry; road transport, highways, water resources
and shipping; railways; science and technology; information technology and electronics; and
human resources development. The following table summarises key takeaways from these
high level visits.

Table 14: Key takeaways from recent visit from Indian Government leaders

DETAILS KEY TAKEAWAYS MAJOR MOUS/AGREEMENTS

Sh. Nitin Gadkari, Focus was on upgrading the bilateral An Undertaking on Mutual Recognition of Certificate
Minister for cooperation between the two countries of Competency of sea-farers was signed during
Road Transport in shipping, ports, highways, river the visit. This will provide employment to Indian
& Highways, interlinking and infrastructure sector. seafarers on over 500 Korean ships.
Shipping and Water Aim was to strengthen the ties between India is exploring of signing MoU with South
Resources, River two countries and cooperation in areas Korea on Highways Information System. This will
Development & such as sharing of technology, joint be developed in cooperation with Korea and will
Ganga Rejuvenation participation in port related construction, be similar to a system run by Express Highways
visit to Korea building and engineering projects etc. Information Corporation of South Korea. This
April 9-12, 2018 initiative has been taken for ensuring road safety of
people.
Finance Minister Sh. The visit of Finance Minister was MOU was signed between EXIM bank of India and
Arun Jaitley visit to primarily for the India-Korea Strategic EXIM bank of Korea. Followed by this, there was
Korea June 14-17, Economic Dialogue Signing Ceremony of EDCF Agreement between
2017 Hon’ble Finance Minster Mr. Arun two countries. The aim was to utilise the Export
Jaitley also addressed businessmen Credits of US Dollars Nine Billion for supporting
at the Korea India Business Meeting, priority sectors, including smart cities, railways,
where CEOs from leading companies power generation and transmission, and other
as well as SMEs, and both corporate sectors as may be mutually agreed.
and institutional investors. The seminar
focused on key achievements of the
government and long-term investment
opportunities in India.
PM Modi’s visit to The two leaders agreed to upgrade Agreement between the Government of the
Korea the bilateral relationship to a ‘Special Republic of India and the Government of the
Strategic Partnership’ Republic of Korea for the Avoidance of Double
May 18-19, 2015 Taxation and the Prevention of Fiscal Evasion
Joint Statement for Special Strategic with Respect to Taxes on Income. India-Republic
Partnership’ PM and President Park of Korea Double Taxation Avoidance Convention
Geun-hye agreed to establish a 2+2 (signed 1985) has been revised with a view to
consultation mechanism at Secretary/ avoiding the burden of double taxation on taxpayers
Vice Minister of Foreign Office and in the two countries.
Defence Ministry.

28 India-Republic of Korea: A New Era of Relationship

DETAILS KEY TAKEAWAYS MAJOR MOUS/AGREEMENTS
Agreed to commence negotiations to India-Republic of Korea Agreement on Cooperation
amend CEPA by June 2016, strengthen in Audio-Visual Co-Production. The Agreement
cooperation on energy, electronics is being signed under the provisions of India-
and shipbuilding industries, including ROK CEPA; it would enable co-production of
setting up of a Joint Working Group for films, animation and broadcasting programmes.
Cooperation on the Shipbuilding sector The Agreement would enable opportunities for
and another in the field of Electronics collaboration between Indian and Korean film
Hardware manufacturing industries, and facilitate collaboration and exchange.
Prime Minister offered to create a MOU for Cooperation between the National
“Korea Plus” group to address all the Security Council Secretariat of the Republic of India
issues raised by Korean companies in and the Office of National Security of the Republic
India of Korea. The MoU would formalize consultations
between National Security Council structures of the
two countries in a number of areas.
MOU between the Ministry of Power of the
Republic of India and the Ministry of Trade,
Industry and Energy of the Republic of Korea
concerning Cooperation in the field of Electric
Power Development and New Energy Industries.
The MoU envisages cooperation in areas of electric
power development and new energy industries
such as renewable energy, smart grids and power
information and technology, transmission and
distribution of electric power, energy efficiency and
storage system.
MOU between the Ministry of Youth Affairs and
Sports of the Republic of India and the Ministry
of Gender Equality and Family of the Republic of
Korea on Cooperation in Youth Matters. The MoU
will strengthen and encourage cooperation on youth
matters through participation in events and activities
through exchanges, international conferences,
seminars, youth camps, festivals etc.
Framework of Cooperation in the Field of Road
Transport and Highways between the Ministry of
Road Transport and Highways of the Republic of
India and the Ministry of Land, Infrastructure and
Transport of the Republic of Korea. To be signed
under the provisions of India-ROK CEPA, the FOC
envisages cooperation in areas including road
policies, design and construction, road operation,
road management and safety, intelligent transport
systems and electronic toll collection systems.
MOU between the Ministry of Shipping of the
Republic of India and the Ministry of Oceans and
Fisheries of the Republic of Korea on Cooperation in
the Fields of Maritime Transport and Logistics.

India-Republic of Korea: A New Era of Relationship 29

 Box 1. Amendment in the Double Taxation Avoidance
Agreement (DTAA)
Double Taxation Avoidance Agreement (DTAA) is a tax treaty that was signed between
India and South Korea on July 19, 1985 and was notified on September 26, 1986. The key
objective of DTAA is to avoid payment of double taxation for the same income earned. On
May 18, 2015 during the visit of Prime Minister Sh. Narendra Modi to South Korea, India
and South Korea signed a revised agreement for Avoidance of Double Taxation Treaty in
Seoul. Last year, the amended treaty replaced the existing one and came into effect in
India on April 1, 2017.

Key Amendments include:

• Capital gain arising on sale of shares of an Indian company to be chargeable to tax
in India.
• Taxpayers may apply for Mutual Agreement Procedure (MAP) in Transfer Pricing
(TP) disputes as well as apply for bilateral Advance Pricing Agreements (APA).
• The MAP requests in TP cases to be presented by the taxpayer to its competent
authority after entry into the revised tax treaty, and within 3 years of the date of
receipt of notice of action giving rise to taxation not in accordance with the tax
treaty.
• As per a separate MOU between the two countries, collection of taxes during
the pendency of MAP proceedings would be suspended for a period of 2 years
(extendable for another 3 years) subject to providing on demand security/ bank
guarantee.

Salient features of Revised DTAA are as follows:

1) Under the revised DTAA the taxation of capital gains will be source based arising
from alienation of shares comprising more than 5% of share capital whereas in the
previous tax treaty, it was on residence based system.
2) The scope of dependent agent Permanent Establishment provisions has been
widened in line with India’s policy of source based taxation.
3) Under the Article 8 of revised DTAA, taxation of shipping income from international
traffic will be resource based. This will help in facilitating movement of goods
between two countries through shipping.
4) There has been reduction in withholding of tax rates on royalties or fees for technical
services from 15% to 10% and 15% to 10% on interest income. This will lead to
promotion of cross border flow of investments and technology.
5) A new Article has been inserted in revised DTAA to provide assistance in collection
of taxes between tax authorities.
6) The revised DTAA also inserts Limitation of Benefits Article. It is an anti-abusing
provision which ensures that the benefits of agreements are availed only by the
genuine residents of both the countries.

30 India-Republic of Korea: A New Era of Relationship

5.2 Recent developments on Korean Industry’s Presence in India
a) Boost in auto manufacturing
Hyundai’s Additional Investment in automobile sector highlighting India’s potential:

Hyundai Motor Co., which has already invested around US$ 3 billion in the Indian automobile
market, is planning to invest an additional US$ 1 billion in this market by 2020. On January
30, 2018, Hyundai Motor India CEO Young Ki Ko stated that the investment will be over US$
20 billion by 2020. The additional investments will be on 9 new products to be launched,
powertrain development and on setting up of new building. HMI is also considering of
introducing Hyundai’s EV sedan ‘IONIQ’ in India.15 The plan of re-launching newly upgraded
Santro is also into consideration. In a statement by CEO Koo, he said that company was
not yet to take a final call on bringing Santro brand (name) back and give it to a new product
codenamed AH2 which is ready to be introduced in the second half of this year.

Kia Motors to roll out first car from India’s plant:

Kia Motors has recently announced of investing of about $2 billion in the green field plant
coming up in Anantapur district of Andhra Pradesh16. The very first phase of the plant will see
an investment of around $1.1 billion and will begin with commercial production of SP concept
and SUV showcased at recently held Auto Expo in New Delhi in January. It’s being estimated
that company’s new plant will create employment opportunities for around 3,000 people and
will produce 300,000 cars annually. The manufacturing facility is expected to begin production
in the second half of 2019.

b) Rising Investments in Electronics

Samsung invested Rs. 4,195 crores in India for expansion of Noida plant:

In the financial year 2107-18, South Korean technology giant Samsung invested around Rs.
4,195 crore in India in its Noida facility plant where it manufactures smartphones, refrigerators
and flat panel televisions. Ravi Shankar Prasad’s vision of making India a $1 trillion digital
economy in coming 5-7 years , Samsung might be the biggest contributor in achieving that
goal as the value addition done by Samsung in India is very high. Also Samsung turned out to
be the most reputable company in India. According to the Brand Trust Report 2018, Samsung
ranked 1st with its smaller South Korean brand LG ranking at the third place.17

India is in discussions with South Korea for jointly setting up 5G test laboratories:

The telecom ministry is planning to collaborate with South Korea too in the area of
telecommunications including setting up of 5G test laboratories. Korea ranked 2nd in
Information Communication Technology Index 2017 by International Telecommunications
Union and, hence can be the early starters of 5G services. Also as per the industry players and
experts, India is likely to see roll out of 5G services in 2019.18

15
Accessed at https://auto.ndtv.com/news
16
Accessed at https://www.thehindubusinessline.com
17
Accessed at http://english.yonhapnews.co.kr
18
Source: https://timesofindia.indiatimes.com

India-Republic of Korea: A New Era of Relationship 31

c) Make in India: Push for Textile manufacturing
Rs. 3,400-cr South Korean textile unit to come up at Shendra, Aurangabad

South Korean textile giant Hyosung will be investing Rs. 3,400 crore in a textile manufacturing
unit at Shendra. 20% of the total procurement of goods and services shall be made from
MSMEs, of which 20% will be from ST and SC owned units. An agreement has been signed
with the South Korean company. Hyosung will set up its unit on a 100 acre area at the Delhi
Mumbai Industrial Corridor’s Shendra node near Aurangabad city. One thousand people will
be directly employed through the project. The project will also create an ecosystem where
smaller industries can thrive.19

Korean investment in Telangana’s Textile Park

Korea Federation of Textile Industries is currently under discussions with State Government
of Telangana to explore the business and investment opportunities in the country. Last year,
the state government invited textile giants in South Korea to their state to consider investing
at the upcoming Kakatiya Textile Park in Warangal. The 2,000-acre park will host both national
and international textile companies and also explained to them about the incentives that the
State Government offered to new industrial units.20

d) Impetus to Infrastructure and Construction

South Korea signed MoU for Infrastructure development in India:

The visit of Hon’ble Minister of Road Transport, Highways and Shipping, Mr. Nitin J. Gadkari
to South Korea has brought great news for India’s infrastructure sector. In June 2017, South
Korea has signed an agreement to provide an Economic Development Cooperation Fund of
US$ 10 billion for infrastructure development in India. In the same spirit, various Korean entities
are also showing their involvement in infrastructure development projects in India.

EXIM bank of India signed $9 billion export credit pact with South Korea:

To support the infrastructural development in India and for supply of goods and services as
part of projects, a $9 billion export credit pact has been signed between the EXIM banks of
both India and Korea. The decision is expected to promote exports and deepen political and
financial relation among the two countries. The export credit will be utilized for promoting
various projects including smart cities, power generation and railways etc. The deal will help in
assessing knowledge in respective activities as well as sharing information on financial export
and import operations.21

Doosan Bobcat to enter Indian Construction Machinery Market:

Doosan Bobcat is considering entering into Indian Construction machinery market by setting
up a plant in Chennai, India. Doosan Infracore, the parent company of Doosan Bobcat, is
signing agreements with local dealers under Make in India program. The main reason of their

19
Accessed at https://timesofindia.indiatimes.com/city/aurangabad/rs-3400-cr-s-korean-textile-unit-to-come-up-at-shendra/
articleshow/62952685.cms
20
Accessed at https://www.thehindubusinessline.com/economy/korean-business-team-in-telangana/article9820800.ece
21
https://www.thehindubusinessline.com

32 India-Republic of Korea: A New Era of Relationship

entry in Indian Construction equipment market is that this particular market is growing rapidly
these days. Among South Korean companies, Hyundai Construction Equipment entered the
market in 2008 and is currently planning to increase its local manufacturing capacity by 20%22.

e) Greater Support Mechanisms for Investors

Korea Plus

Smt. Nirmala Sitharaman, the then Hon’ble Minister of Commerce & Industry, Government of
India and Mr. Joo Hyunghwan, the Hon’ble Minister of Trade, Industry & Energy, Government
of the Republic of Korea, launched Korea Plus, a special initiative to promote and facilitate
Korean Investments in India on 18th June 2016 at New Delhi.

An MOU for establishing Korea Plus was earlier signed between the Ministry of Trade, Industry
and Energy, Govt. of the Republic of Korea and Invest India, the National Investment Promotion
& Facilitation Agency of India in January 2016. This MOU came as an outcome of the visit of
the Hon’ble Indian Prime Minister to South Korea in May 2015.

The mandate of Korea Plus runs through the entire investment spectrum including supporting
Korean enterprises entering the Indian market for the first time, looking into issues faced by
Korean companies doing business in India and policy advocacy to the Indian Government
on their behalf. Korea Plus will act as a mediator in arranging meetings, assisting in public
relations and research/evaluation and provide information and counselling in regard to Korean
companies’ investing in India.

KOTRA’s New Office in West Bengal

KOTRA, Embassy of Republic of Korea has recently opened its new Trade Office in Kolkata,
West Bengal. The Kolkata office is KOTRA’s fifth in India after New Delhi, Mumbai, Chennai
and Bengaluru. The main aim of KOTRA Kolkata is to help both Korean companies to explore
the Eastern and North Eastern India and local companies from the region looking for business
partners in Korea. It had been a strategic choice of Korean Government and KOTRA for
promoting trade and investment in these regions.

Launch of India-Korea CEPA Support Centre in New Delhi

The Ministry of Trade Industry & Energy, KOTRA and Korean Customs Agency recently
inaugurated the India-Korea CEPA Support Centre on May 14, 2018 located in New Delhi. The
Center will support Korean and Indian companies to enhance bilateral trade between India and
South Korea. The inauguration of CEPA Support Center and CEPA Utilization is a step forward
reciprocal and sustainable India-Korea Economic Partnership. The purpose of the centre is to
promote India-Korea CEPA Utilization and bilateral trade and build strong partnership between
the industry players of both countries to explore collaboration opportunities, and promote
trade, investment and technical co-operation.

22
Source: Business Korea

India-Republic of Korea: A New Era of Relationship 33

6 FICCI Initiatives in alignment with GoI’s agenda towards
promotion of India-RoK Relations
FICCI has always put a lot of emphasis on this partnership and has been supplementing
Government of India’s efforts through its holistic agenda with Republic of Korea.

The spectrum of activities with Korea includes engaging with the political leadership, enabling
businesses, producing knowledge work and policy initiatives, synergising with the state and
provinces, engaging on a track two diplomacy and promoting people to people connect as well
as new initiatives. The key partners of FICCI in Korea include KITA (Korea International Trade
Association), KOTRA and KCCI (Korea Chamber of Commerce and Industry).

Following are some of the key FICCI initiatives with South Korea in the focus areas in line with
government’s agenda.

Defence cooperation
Defence and security relations between India and South Korea have evolved steadily over
the past few years and now constitute a strong pillar of the India – South Korea strategic
partnership. FICCI’s defence committee has been consistently working to strengthen industry
cooperation between India and South Korea in the defence sector. There is tremendous scope
for redefining the contours of the bilateral defence cooperation by way of transfer of, and
collaboration on co-development and co-production of projects related to defence equipment
and technology.

In this context, FICCI coordinated defense delegation to South Korea. In 2015, FICCI undertook
Defence & Aerospace Business delegation accompanying the Defense Minister to South
Korea to Seoul, South Korea.

Finance Minister’s Visit to Korea

On the occasion of the official visit of the Hon’ble Finance Minister, Mr Arun Jaitley to Republic
of Korea from June 14 to June 18, 2017, FICCI organized a high-powered CEOs delegation
accompanying the Hon’ble Finance Minister. The business delegation was led by Mr. Rashesh
Shah, Senior Vice President, FICCI, and Chairman & CEO, Edelweiss Group and was well
represented by industry and business heads from diversified sectors.

The main objective of the delegation was to enhance the bilateral economic engagement
and business co-operation between the two countries. Indo-Korean relations have been
growing over the past few years and this visit shall further strengthen mutually beneficial
trade and investment relations between the two countries. India is today one of the most
attractive investment destinations for global investors and there is a potential for much greater
investments from various countries, including South Korea.

34 India-Republic of Korea: A New Era of Relationship

Another highlight of the visit was the signing of an MoU between Export-Import Bank of
India and the Export-Import Bank of Korea. The aim was to utilise the Export Credits of US$
9 billion for supporting priority sectors, including smart cities, railways, power generation and
transmission, and other sectors as may be mutually agreed.

The discussions included the progress made across various development programmes and
various measures taken by the government to steer the economy to higher growth path to
various stakeholders in Korea. The visit also served as a great opportunity to highlight the
potential areas for further co-operation, especially in areas like manufacturing, agriculture and
food processing, new renewable energy, ship-building, defense manufacturing, infrastructure,
etc.

Support for Make in India

FICCI has been actively supporting Government of India in its Make in India initiative. In order
to strengthen India-Korea partnership in this area, FICCI in partnership with Korea Trade
Promotion Agency KOTRA, organised the Korea Expo 2017 on September 20 – 22, 2017 in
New Delhi. Korea Expo 2017 was hosted by Ministry of Trade, Industry and Energy (MOTIE) of
the RoK. KOTRA in partnership with FICCI is organizing this event which is supported by India
SME Forum and Indian Electrical & Electronics Manufacturers Association.

This was the largest business event held in India after the two countries concluded the CEPA
in 2009. It attracted 530 buyers from 8 countries including India, Southwest Asia and the
Middle East countries. The major events of the Korean Product Exhibition included one-on-
one expert consultation between Korean companies and Indian buyers, Korea-India Economic
Cooperation Forum. Majorly, the event was aimed to promote bilateral trade and investment
relations between Korea and India and the expo presented an ideal opportunity for taking India-
Korea bilateral relations to a new height in the years to come and significantly contributes in
supporting Prime Minister’s Make in India initiative.

The Korea Expo showcased exhibits from a high-level business delegation of around 100
Korean companies (from sectors of Infrastructure, Consumer durables, Consumer electronics,
cosmetics, Lighting, Building & Construction, Security equipment and Automotive). The
3-day program created immense opportunities for companies from both the countries to
meet, discuss and collaborate in various industry segments, thereby opening up vast pool of
opportunities and enhancing the progress of both economies.

Promoting Corporate Social Responsibility

India-Republic of Korea relations have made great strides in recent years and become truly
multidimensional, spurred by a significant convergence of interests, mutual goodwill and high
level exchanges. Today, a majority of Indian customers relate to LG and Samsung as Indian
brands rather than multinational brands. This is indeed the recognition of the evolving strategic
scenario in the region and the deepening of India- Korea comprehensive engagement. Korean
companies are playing a major role in automobile and electronics sectors. This growing
engagement is also creating huge opportunities for businesses but also great challenges.

Korean companies are committed to undertaking CSR activities in the right earnest and
emphasised that CSR presents a huge opportunity for them to earn corporate goodwill and
address social development gaps of the nation.

India-Republic of Korea: A New Era of Relationship 35

With an aim to learn, share and discuss the achievements, challenges, innovations of the Korean
Companies in India, while addressing and leveraging the Government of India’s initiatives like
Skill Building, Swachh Bharat Abhiyan etc., the Korea-India CSR Forum was formed.

The Korea-India CSR Forum is a bilateral forum between FICCI and the Embassy of the Republic
of Korea in India, funded by the Embassy of the Republic of Korea in India, and is organized
every year.

Building Connect with Indian States

In the current portfolio of foreign engagements, there is a direct connect being made by
Indian states with international partners. FICCI has been actively promoting increased connect
between Indian States and South Korea. For instance, Assam is one the fastest growing state
of Eastern India and is at the heart of India’s Act East Policy. In order to give this momentum,
the Government of Assam organised its maiden Global Investor’s summit “Advantage Assam”
on February 3 and 4, 2018”. The summit was inaugurated by Hon’ble Prime Minister of India,
Narendra Modi.

In order to promote the Advantage Assam summit, amongst foreign investors, the Government
of Assam in partnership with FICCI organised roadshows in Seoul. The key component of the
visit to Seoul were the one to one meetings with leading Korean Companies representing
infrastructure, food processing, IT, logistics, shipping, railways sectors. Nongshim Engineering,
Korea’s leading food product manufacturer, Korea Telecom Corporation, Korea’s largest
telephone company, Space Group, a company that offers one stop solution to architectural and
urban problems, ableMAX/Dongbu Corporation/Hyundai Construction, KDS Global Co. Ltd. - a
supply chain management group and Rotem were some of the leading Korean companies that
participated in the one to one meetings.

Korean companies and members of Incheon Chamber of Commerce (ICCK) showed keen
interest in the fast growing state of Assam and expressed their willingness to invest in Assam
and participate in the forthcoming Advantage Assam Summit.

Similarly, FICCI also coordinated the delegation for the West Bengal State government to
South Korea during October 22 – 24, 2017 last year. The delegation was led by Mr. S. Kishore,
IAS, Department of Industry, Commerce & Enterprises, and Government of West Bengal. The
visit included business meeting with key trade promotion agencies including KOTRA and KCCI
(Korean Chamber of Commerce & Industry). The delegation also met with President & Senior
Office bearers of ICCK and had an exclusive interaction with Mayor of Incheon province.

36 India-Republic of Korea: A New Era of Relationship

7 The Way Forward
India is keen to buttress its partnerships with countries across the Indo-Pacific region: a concept
describing the evolving geopolitical and economic order surrounding the Indian Ocean’s tropical
waters, the western and central Pacific Ocean and the Southeast Asian seas.

Prime Minister Modi has stated that the purpose of engagement across the Indo-Pacific should
be to promote cooperation, not dominance; connectivity, not isolation; respect for the global
commons; inclusive, rather than exclusive, architectures; and adherence to international rules
and norms.

Therefore our focus is on the development of an open, transparent and inclusive architecture
linking the Indian and Pacific oceans. We desire to work with all stakeholders whose prosperity
and security depend on the waterways traversing these two major oceans.

Key sectors for Industry Cooperation

Defense manufacturing
Defense ties in particular have grown from strength to strength, with a major defense
partnership deal worth nearly $1 billion signed last year for the joint production of Korean
self-propelled artillery guns and India’s purchase of these weapons. Five Indian Navy vessels
have sailed to Korea over the past three years, extending the blood-sealed partnership that
stretches back to the 1950-53 Korean War.

The two governments signed the Strategic Partnership Agreement in defense production in
March last year, identifying areas of further cooperation.

Areas of Cooperation between South Korea and India

Our goal is to be able to find synergies between areas of India’s strengths and Korea’s
needs, and vice versa.

Shipbuilding is one such area in which Korean firms could look at India’s naval roll-out
strategically, as a means of ensuring standing business orders for future decades.

Indian bright young military officers are also studying at each other’s military academic
and related institutions for the first time on an institutionalized basis of exchange annually.
They will recognize the opportunities and potentials our India-Korea partnership offers.

India-Republic of Korea: A New Era of Relationship 37

Maritime and Ship Building
The Indian maritime industry is an integral part of the country’s trade and commerce. It supports
90% of India’s trade by volume. India has a coastline of 7,517 km with potentially navigable
waterways of 14,500 km. 12 major and 200 non-major ports are dotted along the coast.

Over the last two years, a host of policy and regulatory reforms by the Government has resulted
in capacity building and service delivery improvement.
• Foreign Direct Investment (FDI) of up to 100% allowed under the automatic route for
port and harbour construction and maintenance projects.
• Cabotage restrictions relaxed for special vessels for a period of five years w.e.f.
September 14, 2015. With this relaxation, vessel operators will be allowed to bring
foreign flagged vessels of these categories to ply on coastal routes.

Areas of Cooperation between South Korea and India

Strengthening Indian maritime industry in the oceans economy, we are rapidly expanding
our naval and coast guard capabilities that include aircraft carrier groups, submarines and
aircrafts.

Indian security needs require an extensive scaling-up of our existing platforms. Some $35
billion worth of equipment is currently on our navy’s shopping list for procurement over
the next decade and beyond Korean shipyards and their tier-one companies, which have
faced industrywide financial difficulties in recent years, to create partnerships with India’s
maritime enterprises. The Indian market can not only sustain their businesses, but also
create jobs on both sides.

Electronics and IT Sector

The Government is driving forward reforms in IT and electronics manufacturing sector through
major initiatives like Make in India and by creating favourable policies to enable an investor
friendly environment.

Some of the Korean companies who made it to the top investment in Indian companies list for
this sector include:

Korean Company Indian Company Sector FDI (US$ million)

Dong Kwang Precision Co Dongkwang Precision India Electronics 6.29
Ltd. Private Limited
Elentec Co. Limited Elentec India Private Electronics 1.98
Limited
Ripe Korea Co. Limited Elentec India Private Electronics 1.69
Limited

Source – Electronics and IT Sector Achievement report, DIPP

38 India-Republic of Korea: A New Era of Relationship

 Areas of Cooperation between South Korea and India
Promoting Collaborative Industrial R&D

Funding through Global Innovation and Technology Alliance (GITA). Focused on priority
areas of Large Area Flexible Electronics, Internet of Things (IOT) and Technology for
Internal Security with a timeline of not more than two years. Medical Electronics, Strategic
Electronics and Micro Electronics Mechanical Systems (MEMS) are also covered for
funding under the scheme The Request for Proposals (RFP) have been launched bilaterally
with South Korea, Finland, UK, Spain and Canada.

Collaborate in manufacturing of electronics and computer hardware and software

One of the major policy initiatives in this sector includes 100% FDI under automatic route
is permitted in the manufacturing of electronic items. South Korea is already an important
investor in Indian companies in electronics sector and computer hardware and software.

Source – Ports and Shipping Achievement report, DIPP

Manufacturing
The share of manufacturing in India’s GDP has stayed around 15% for nearly three decades.
This lost opportunity has been a vital link missing in India’s growth story. Manufacturing is a key
focus area of the Government and the Make in India campaign launched recently endeavours
to make India a global manufacturing hub.

Areas of Cooperation between South Korea and India

• South Korea is one of the leading countries in production of high performance fibers and
fabrics that are used in variety of applications like sportswear, industrial infrastructures,
buildings, stadiums etc. The potential of Indian technical textiles markets is huge with
the current focus of the Government of India. Technical Textiles has been recognized
as one of the focus areas and high value added segment.
• The global electronics industry is valued at US$1.8 trillion, of which India consumes
around US$125 billion. This consumption is expected to grow to US$400 billion by
2020 with the local production of only US$104 billion. India currently imports mobile/
telephone sets worth more than one billion US dollar from South Korea. This needs
to be converted into investments and local manufacturing. Most of the Electronic
Manufacturing Services and Original Equipment Manufacturers mainly undertake last-
mile assembly, and not much designing is undertaken in the country. The supplier and
contract manufacturer base in India is limited with a majority of high value and critical
components being imported. This is an area where Korean companies can help Indian
firms and promote manufacturing of such items in India.

Source – Indian Industry

India-Republic of Korea: A New Era of Relationship 39

Renewable Energy
India has emerged as one of the fastest growing economies of the world with the clear
objective of attaining a double-digit growth over the next few years. However one of the
major impediments that can arise in its path towards this higher growth trajectory is its
inadequate access to energy. As a nation, India has been making efforts to power its industrial
and economic growth by leveraging both domestic sources of energy and its energy assets
abroad. Even as it makes progress in ramping up supplies, the quantum of demand and the
rate at which it is growing calls for continued thrust.

Areas of Cooperation between South Korea and India

• Cooperation with Korea South East Power Co. (KOSEP) &Doosan Heavy Industries
(DHI) could extend to technology transfer concerning super critical boilers and clean
coal technologies
• Nuclear energy forms a third of Korea’s electricity supply, with 23 nuclear power plants
in operation. Korea is keenly looking towards export of Nuclear reactors and has signed
export deals with Jordan and UAE. Korea Power Engineering Company (KOPEC) is
responsible for Design & EPC of Nuclear Power Plants. A greater level of engagement
with KOPEC with Indian nuclear manufacturing companies could be explored
• South Korean companies are pioneers in LNG ship building. The world’s biggest
LNG ship – The Preludes, was manufactured there for Shell. Also, KOGAS is the
world’s largest buyer of LNG. India will continue to import larger volumes of LNG
for foreseeable future. Joint development of LNG ships with established players in
South Korea such as Samsung Heavy Industries (SHI), Hyundai Heavy Industries (HHI)
and Daewoo Shipbuilding and Marine Engineering (DSME) should be firmed up. LNG
import market can be jointly explored with KOGAS

Source – Indian Industry

Infrastructure
Infrastructure is the lifeline of any economy and the presence of a sound infrastructure base
is the key to ensure rapid development of any country. India has taken several steps to build
up its infrastructure. Today, India boasts of the second largest road network in the world. The
development of highways and expressways has seen significant progress in the country. India
also has an exceedingly well-developed railway network. With the world’s second largest rail
network, Indian Railways is also the world’s largest commercial employer employing about
1.6 million people. The railway sector, which has witnessed increased participation from the
private sector in recent years, today boasts of improved revenues.

40 India-Republic of Korea: A New Era of Relationship

 Areas of Cooperation between South Korea and India
• Opportunities for strengthening partnership between Korea and India in infrastructure
sector are numerous. Transportation, Road & Highways, Bridge & Tunnel Construction,
Intelligent Transport Systems, Railways, Ports, Airport modernization, etc. are the
areas where both the countries can work together.
• Maritime sector offers huge investment opportunities for Korea as India is expeditiously
working out the ambitious ‘Sagarmala Project’ by integrating various components
viz. port facilities, coastal ferry services, tourism infrastructure, and inland water
transportation. There is substantial scope for India-Korea cooperation in expanding
transportation capacity by improving multimodal connectivity, port connectivity by
improving road & rail connections, construction of container terminals/ berths, inland
water transport, etc.
• Indian Government is focusing on the shipbuilding industry under Make in India
initiative, and is encouraging foreign investments in shipbuilding. It offers immense
opportunities for Korean companies to cooperate with Indian firms in the field of
shipbuilding and ship repairing.
• In railways, private investments are currently required in the field of producing railway
coaches, railway locomotives, wagons and various ancillary components. There are
ample opportunities for the Korean companies to make investments and facilitate
development & expansion of Indian Railways. Korea can provide technical assistance for
building high speed rail, modernisation of rolling stock, railway operations, modernisation
of signalling, construction & maintenance technologies and in development of logistics
parks & cargo terminals.

• Korean companies having expertise in sustainable architectural & design, professional

engineering services, etc. can bring their know-how, technology and business models
that are required to build environment friendly infrastructure facilities.

Source – Indian Industry

Telecom
India has made rapid strides in the telecom sector and has emerged as an ace performer
in the field. India is the world’s second largest telecommunication market and the growth
in segments like mobile telephony, internet penetration has been unprecedented. Further,
the Digital India campaign launched by the Government has the mandate of making India a
knowledge based economy.

Cooperation between India and Korea in telecom sector exists for several years now. Some of
the major Korean companies in this sector having their units in India are Samsung Electronics
Co. Ltd, LG Electronics Inc. and Korea Mobile Telecom etc. Korean telecom equipment is
being used in the Indian telecom network for the last 10 years.

India-Republic of Korea: A New Era of Relationship 41

 Areas of Cooperation between South Korea and India
• As mentioned earlier, Korean companies can set up manufacturing facilities in India
in the field of telecom equipment and telephone handset. The Indian government has
recently announced tax incentives to attract manufacturing of these instruments in the
country.
• Cooperation in the area of 4th generation mobile telecommunication system for
providing multimedia via high-speed network with focus on graphics and high quality
audio services must be considered.
• Other areas of cooperation include Mobile Wireless Program, Digital home & office
broadband technology, Next Generation PCs, Digital Content and Digital Broadcasting.

Source – Indian Industry

Healthcare
India’s health care sector has shown robust growth over the past few years, emerging as one
of the most promising in the country. With the development of several other allied fields like
health tourism, telemedicine and pharmaceuticals the sector today provides huge employment
opportunities and has become a source of increasing revenues. The overall healthcare market
is valued at US$ 65 billion.

Further, the Indian pharmaceutical industry is one of world’s largest, ranking third in terms
of volume and thirteenth in terms of value in the global pharmaceutical market. The Indian
pharmaceutical sector has become a prominent international provider of health care products,
while meeting most of the domestic needs.

Areas of Cooperation between South Korea and India

• Manufacturing of medical equipment in India on a JV basis
• Hospital collaborations for strategic planning process and the operational performance
improvement
• Collaborations for Telemedicine and Tele-radiology
• Promotion of health tourism and exchange programmes between medical educational
institutions
• Joint training programmes for human resource development and sharing of information
and experiences in respect of best practices in healthcare systems
• Technical cooperation in development of traditional medicinal products

Source – Indian Industry

42 India-Republic of Korea: A New Era of Relationship

Higher Education
Education is the basic foundation for ensuring sustainable development of a country. Without
imparting education to its people, no country can ensure progress and quality life to its
citizens. India has realized the importance of education and has made significant progress
in building a sound human development base in the country. The overall literacy rate for the
country has gone up from 52.2% in the year 1991 to 65 % in the year 2001 to 73% in 2011.
Further, the government is giving higher education due primacy and is undertaking expansion
in an enormous way. Further, a renewed emphasis is being given to vocational training and a
more job oriented training to plug the demand-supply mismatch of skills. The private sector
has come to play an increasingly active role and has become instrumental in setting up of
specialized training institutes in the vocational education domain. However, India still needs
to firm up three pillars – viability, quality and capacity – to ensure a globally competitive higher
education eco system.

Areas of Cooperation between South Korea and India

• Increase participation of higher education delegations in education fairs and conferences
in respective countries.
• Exposure visits for Indian Universities/Higher Educational Institutions for showcasing
transformation of Korean Higher education system specifically with regard to their
evolution as an R & D hub and effective linkages with industry. Republic of South
Korea spends 4.36 % of its GDP on R&D, which is amongst the highest in the world.

Source – Indian Industry

Exploring Korean Partnership in India’s flagship initiatives

India is on the threshold of major reforms and according to recent studies, is projected to
achieve highest annual GDP growth rate and overtake China in the coming years. To keep our
date with these historic turns, the Indian Government in India has embarked on a vigorous
agenda of development with measures to cut red tape, relax labour laws, drive financial
inclusion and liberalize foreign direct investment norms in critical sectors of the economy
like defence, insurance and construction. These are unleashing huge untapped potential for
collaboration between industries on both sides.

South Korea stands out as a spectacular example of a mature democracy with an impressive
record of industrialization, technological advancement, innovation, economic reform, and
sound leadership.

And together, India and Korea continue to record a surge in two-way commercial exchanges
with bilateral trade growing and Korean investment in India and Indian investment in Korea
crossing new frontiers. The two countries are working together bilaterally as also in regional
fora to address challenges facing the region including maritime security and putting in place an
open and inclusive regional security architecture, among others.

India is therefore well placed to explore the vast scope of our strategic partnership and going
ahead India sees some very potential areas that provides room for further expansion.

India-Republic of Korea: A New Era of Relationship 43

 • The Make in India campaign launched in September 2014 showcases the priority of
the government of India to develop a robust manufacturing sector in the country. The
sector has the potential to not only take economic growth to a higher trajectory, but
also to provide employment to a large pool of our young labour force. Under the Make
in India initiative 25 sectors have been identified for investors to set up manufacturing
bases, replete with initiatives designed to facilitate investment, foster innovation,
protect intellectual property as well as promote exports from the country.
The Indian defence industry is one of the fastest-growing global defence markets
and India is one of the largest importers of conventional defence equipment. The FDI
limit in defence manufacturing has been raised to 49% from erstwhile 26% and my
government is focusing on promoting indigenization, technology up-gradation and
developing capabilities for exports in the defence sector. The opening of strategic
defence sector for private sector participation will help foreign original equipment
manufacturers to enter into strategic partnership with Indian companies and leverage
the domestic markets.
• The Indian government also has a vision of developing 100 smart cities as satellite
towns of larger cities and by modernising the existing mid-sized cities. Smart cities
will require latest technologies in water conservation, energy conservation, renewables
energy, information technology apart from host of other technologies in manufacturing
and infrastructure.
• Mega plans are underway in India to create a network of new industrial corridors and
industrial cities. Six industrial corridors are being developed, these are - Delhi-Mumbai
Industrial Corridor, Bengaluru - Mumbai Economic Corridor, Chennai-Bengaluru
Industrial Corridor, Amritsar-Kolkata Industrial Corridor, Chennai-Vizag Industrial Corridor
and North-East Corridor Linked to Myanmar. Industrial cities will also come up along
these corridors. These clusters will provide costs and productivity gains and drive India
up in the manufacturing value chain. Korea can play a crucial role in building world
class infrastructure like the Dedicated Freight Corridor, Bangalore-Mumbai Economic
Corridor.
• As part of an increased focus on developing high-speed rail network in the country
we have opened up the railways to foreign equity and allowed 100% FDI in areas
including construction, operation and maintenance of suburban corridors through PPP,
high speed train projects, dedicated freight lines, rolling stock including trains sets and
locomotive/coaches manufacturing and maintenance facilities, railway electrification;
signaling system; freight terminal; passenger terminal and mass rapid transport system.
This offers immense opportunities for Korean investors and Indian government has
prepared model concession agreements for different participative models.
• India is also on track to enhance digital connectivity for delivery of governance and
services to Indians. Our flagship programme ‘Digital India’ aims to create a participative,
transparent and a responsive government connected to our citizens by ensuring that
government services are available to citizens electronically and help people gain benefits
from the latest information and communication technology. The project also aims to
ensure that all villages in India have high speed Internet. This will mean higher spend
on technology including internal services, software, IT services, data centers, devices
and telecom services by both local and national governments. India also has a huge
electronics market but around 65% of the current demand for electronics products is
met by imports. This is where we hope investor-friendly incentive schemes and policies

44 India-Republic of Korea: A New Era of Relationship

 like Digital India can attract Korean businesses to collaborate in this project and support
India’s development.
• We are living in a world characterized by shrinking energy resources and increasing
cost of energy. Renewable energy holds great promise for collaboration given India’s
burgeoning energy needs and a rapidly developing energy market but the imperative is
to make renewable sources like solar and wind power affordable. Setting up of hybrid
energy parks in areas with abundant sun radiation as well as wind potential to save on
transmission and power evacuation infrastructure cost is one idea. Indian government
is also keen on developing domestic manufacturing of renewable energy equipment
to create jobs. India has extended some major policy incentives including accelerated
depreciation, generation based incentives; feed in tariff and viability gap funding which
are expected to add massive investments in the renewable energy sector.
• ‘Skill India’ programme replete with extensive training modules aims to ensure supply
of workers with wide ranging skills for domestic needs and to meet skill demands
in foreign countries. India is looking at enhanced industry interfacing on skills and
education, integration of vocational skills in mainstream education, capacity building
and leadership development. A skills fund to help incubate Indo-Korean partnership in
skills is an idea worth exploring.

India-Republic of Korea: A New Era of Relationship 45

 Snapshot of the Recent Developments between India and
7 Korea with Highlights on Recent Regulatory Developments
and Key Indicators on Certain State Incentives
1. Recent regulatory developments
(a) Developments in the foreign investment regime:
Foreign investment in India is primarily regulated by:
• the consolidated foreign direct investment policy (FDI Policy) issued by the DIPP from
time to time;
• the Foreign Exchange Management Act, 1999 (FEMA); and
• the regulations and directions issued by way of notifications by the RBI under the
FEMA including in particular the Foreign Exchange Management (Transfer or Issue of
Security by a Person Resident Outside India) Regulations, 2017 (New FEMA 20) read
with the RBI’s Master Directions on Foreign Investments in India dated January 4, 2018
as amended from time to time (Master Directions on Foreign Investments).

The Indian government has, over the recent years, liberalised the foreign investment regime
further to attract foreign investment and increase FDI inflow into India. The RBI had, in
November, 2017 issued the New FEMA 20 to replace the Foreign Exchange Management
(Transfer and Issue of Security by a Person Resident Outside India) Regulations, 2000 (Old
FEMA 20) and the Foreign Exchange Management (Investments in Firms or Proprietary
Concern in India) Regulations, 2000 (FEMA 24), subsuming them within the New FEMA 20.

A few key changes in the New FEMA 20 are as follows23:

• Introduced definition of ‘foreign investment’, categorizing it into ‘FDI’ and ‘foreign
portfolio investment (FPI)’. Foreign investments made in unlisted and listed Indian
companies have also been segregated, and thresholds have been provided for
calculating FDI and FPI. Pursuant to the rationalisation of these definitions, a new route
has opened up for non-residents to invest in a listed Indian company up to a limit of
10% the paid up share capital of the listed company;
• Removed cap on dividend that can be paid by Indian companies on preference shares
issued to non-residents;
• Removed requirement to obtain RBI approval for transfer of capital instruments by a
non-resident Indian to a non-resident;
• Permitted persons resident outside India to acquire capital instruments (other than
share warrants) renounced by residents pursuant to a rights issue.24 Now, a rights

23
https://rbi.org.in/scripts/BS_FemaNotifications.aspx?Id=11161
24
Regulation 6 of New FEMA 20.

46 India-Republic of Korea: A New Era of Relationship

 issue is permitted at a price: (a) determined by the company, in case of listed Indian
companies25; and (b) at which capital instruments are offered to residents, in case of
unlisted Indian companies26;
• Reduced the timeline for allotment of instruments to 60 days from the date of receipt
of consideration, as compared to 180 days previously;
• Placed the responsibility on the non-resident transferor to report a transfer of capital
instruments listed on recognised stock exchange in India to the authorised dealer bank
in Form FC-TRS.27 Under the Old FEMA 20, this responsibility lay with the investee
Indian company;
• Introduced the requirement of a joint audit of an Indian investee company. Where non-
residents have made foreign investment into an Indian investee company and specify a
particular auditor or audit firm with an international network to carry out the audit of this
company, then this audit shall be undertaken by two or more auditors not forming part
of the same network;28
• Provided that foreign investment in investing companies not registered as non-banking
finance companies (NBFC) with the RBI and in core investment companies, both
engaged in the activity of investing in the capital of other Indian entities now requires
prior governmental approval.29 Further, foreign investment in investing companies
registered as NBFCs with the RBI is now under the 100% automatic route30;
• Permitted 100% foreign investment under the automatic route in ‘other financial service
activities’ regulated by financial sector regulators, i.e., RBI, Securities Exchange Board
of India, Insurance Regulatory and Development Authority, Pension Fund Regulatory
and Development Authority, National Housing Bank. For financial services not regulated
by a financial regulator, or for services for which there exists a doubt about the status
of their governance, foreign investment up to 100% is permitted under the government
approval route31.

The FDI Policy of 2017 had also introduced the following key changes:
• Permitted foreign investors to invest in eligible start-up companies (duly formed private
companies recognised as start-ups by the DIPP) by purchasing their convertible notes
(convertible into security of the start-up company) for an amount of Rs. 25 lakhs or
more in a single tranche. If such eligible start-up companies are engaged in sectors
which are in the approval route, prior approval from Government would have to be
obtained for such issuance or transfer of convertible notes;
• Permitted foreign investment up to 100% through the automatic route in entities
engaged in the single brand retail trading sector;32
• Permitted investment in Air India, India’s national air carrier, in the Civil Aviation (Air
Transport Services) sector. Investment in Air India can be made under the automatic

25
Regulation 6(4) of New FEMA 20.
26
Regulation 6(5) of New FEMA 20.
27
Regulation 13.1(4)(b) of New FEMA 20.
28
Regulation 16(B)(8) of New FEMA 20.
29
Regulation 16(B)(5)(a) of New FEMA 20.
30
Regulation 16(B)(5)(b) of New FEMA 20.
31
Regulation 16(B)(F.10.1) of New FEMA 20.
32
Regulation 16(B)(15.3) of New FEMA 20.

India-Republic of Korea: A New Era of Relationship 47

 route subject to the following conditions: (a) foreign investment in Air India Limited,
including that of foreign airline(s), shall not exceed 49% either directly or indirectly; and
(b) substantial ownership and effective control of Air India Limited shall remain with
Indian nationals33; and
• Clarified that for the purposes of ‘real estate business’ under the New FEMA 20, broking
services will not be considered to be real estate business. As ‘real estate business’
excludes broking services, foreign investment up to 100% is permitted in entities
providing these services through the automatic route.34

(b) Development in the insolvency and bankruptcy regime:

The Insolvency and Bankruptcy Code, 2016 (Code) was enacted to provide a comprehensive
legislation for insolvency and bankruptcy proceedings in India. Noting that corporate entities
transact businesses in multiple jurisdictions, the Indian government felt that the Code did
not provide a comprehensive framework for cross border insolvency matters. Therefore, the
Ministry of Corporate Affairs, Government of India has recently proposed a framework for
such matters by preparing a draft chapter on Cross Border Insolvency (Draft Framework) and
has invited public comments on this Draft Framework35.

The basis of this Draft Framework is the UNITRAL Model Law on Cross-Border Insolvency,
1997 (Model Law). Three major benefits of adopting the Model law are envisaged: (i) reduction
in time for exchanging necessary information between countries; (ii) increase in credit recovery
efficiency; and (iii) cooperation and assistance helps in preserving the company’s assets
from dissipating, resulting in successful reorganisation. Certain deviations from the Model
Law have been incorporated into the Draft Framework, e.g., in relation to allowing foreign
representatives ‘direct’ access to proceedings in India. Once this Draft framework is brought
into effect, it will result in increased predictability and certainty in the cross border insolvency
resolution processes for overseas parties. Korea has already adopted the Model Law in 200636,
which will further ease the resolution of insolvency claims between India and Korea after India
adopts the Draft Framework.

2. Other recent developments

(a) Government initiatives
In recent years, various Indian government / state government officials, including Prime
Minister Narendra Modi, have visited Korea for high level discussions and further development
of the economic relations between the two countries. The key takeaways of some of these
visits have been discussed in section 5.1 (Table 14) of this Report.

34
Note 7 to Regulation 16(B)(10.2) of New FEMA 20.
35
http://www.mca.gov.in/Ministry/pdf/PublicNoiceCrossBorder_20062018.pdf
36
http://www.uncitral.org/uncitral/en/uncitral_texts/insolvency/1997Model_status.html

48 India-Republic of Korea: A New Era of Relationship

(b) Korean Ambassador’s initiatives
The Korean Ambassador to India, H. E. Shin Bong Kil had recently visited the Chief Minister of
Uttar Pradesh, Yogi Adityanath, on April 6, 2018, and discussed cooperation between Korea
and Uttar Pradesh.37

The previous Ambassador, H. E. Cho Hyun had met with the then Minister of Information
& Broadcasting, Venkaiah Naidu, on November 20, 2016. They had discussed cooperation
between India and Korea in the film and audio-visual sector with certain representatives of the
Korean film companies and Korean Film Commission.38

37
http://overseas.mofa.go.kr/in-en/brd/m_2653/view.
do?seq=757164&srchFr=&srchTo=&srchWord=&srchTp=&multi_itm_seq=0&itm_
seq_1=0&itm_seq_2=0&company_cd=&company_nm=&page=3
38
http://overseas.mofa.go.kr/in-en/brd/m_2653/view.
do?seq=743065&srchFr=&srchTo=&srchWord=&srchTp=&multi_itm_seq=0&itm_
seq_1=0&itm_seq_2=0&company_cd=&company_nm=&page=5

India-Republic of Korea: A New Era of Relationship 49

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Choudhary, D. R. (2018, February 27). The Economic Times. Retrieved from economic times india
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summit-make-in-india-gets-a-leg-up-from-south-korean-honchos/articleshow/50572466.cms

Doraiswami, J. L. (May 14, 2018). India, Korea can leap forward across Indo-Pacific. The Korea
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India Korea for an early conclusion of CEPA Review. (2018, February 27). Economic Times.

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com/home

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newsite/PrintRelease.aspx?relid=174117

Sheshadri, V. (2015). India Korea CEPA: An Appraisal of Progress. New Delhi: Research and
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50 India-Republic of Korea: A New Era of Relationship

 Established 90 years ago, FICCI is the largest and oldest apex business
organization in India. Its history is closely interwoven with India’s struggle
for independence, its industrialization, and its emergence as one of the
most rapidly growing global economies.

A non-government, not-for-profit organization, FICCI is the voice of India’s

business and industry. From influencing policy to encouraging debate,
engaging with policy makers and civil society, FICCI articulates the views
and concerns of industry, reaching out to over 2,50,000 companies. FICCI
serves its members from large (domestic and global companies) and MSME
sectors as well as the public sector, drawing its strength from diverse
regional chambers of commerce and industry.

The Chamber with its presence in 14 states and 10 countries provides a

platform for networking and consensus-building within and across sectors
and is the first port of call for Indian industry, policy makers and the
international business community.

India-Republic of Korea: A New Era of Relationship 51

 notes

52 India-Republic of Korea: A New Era of Relationship

 notes

India-Republic of Korea: A New Era of Relationship 53

 notes

54 India-Republic of Korea: A New Era of Relationship

India-Republic of Korea: A New Era of Relationship 55
 For any clarification please contact

Mr Gajendra Badgujar Ms Vrinda Seksaria

Additional Director-East Asia Division, FICCI Research Associate-East Asia Division, FICCI
E : gajendra.badgujar@ficci.com E : vrinda.seksaria@ficci.com
M : +91 9717864455 T : +91-011-23487320
Location: New Delhi Location: New Delhi

56 India-Republic of Korea: A New Era of Relationship