Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
Korea, India to boost economic ties by improving free trade agreement
President Yoon Suk Yeol shakes hands with Indian Prime Minister Narendra Modi during a bilateral summit held on the sidelines of the Group of 20 meeting at the Bharat Mandapam International Convention Center in New Delhi, India, Sunday (local time). Joint Press Corps
By Nam Hyun-woo
By Nam Hyun-woo
NEW DELHI ― President Yoon Suk Yeol and Indian Prime Minister Narendra Modi held a summit in New Delhi, Sunday, and explored ways to improve their economic partnership by improving a free trade agreement Korea and India signed, known as the Comprehensive Economic Partnership Agreement (CEPA), and lowering non-tariff barriers.
The leaders met on the occasion of Yoon's participation in the Group of 20 (G20) Summit hosted by India. The bilateral summit also marked the 50th anniversary of diplomatic ties between the two countries.
According to Seoul's presidential office, the leaders agreed to pursue progress in negotiations improve the CEPA and recognized the anticipated benefits of the upcoming Electronic Origin Data Exchange System (EODES) between their customs authorities.
The Korea-India CEPA took effect in 2010.
Experts have said CEPA needs to be improved, pointing out that its concession rate is too low compared to the Japan-India free trade agreement, while some items entail heavier duties than the World Trade Organization's most-favored nation tariffs.
To address this, Korea and India have held nine rounds of talks since 2016 to improve the free trade agreement, but failed to make tangible progress.
“There have been comments that there is significant room for improvements in the Korea-India CEPA in terms of its concession rate and investor protection,” senior presidential secretary for economic affairs Choi Sang-mok said.
“India is expressing concerns over opening up its market further due to a worsening trade deficit after the CEPA took effect, but we will make efforts to find mutually beneficial points as we work towards a balanced expansion of trade,” Choi added.
To address non-tariff barriers, the two countries will set up EODES, which enables the real-time exchange of origin data between their customs authorities. When launched, exporters and importers in Korea and India will not be required to submit paper certificates of origin when applying for preferential tariffs under the free trade agreement.
Yoon asked Modi to help establish a more favorable customs environment and address the issue of India's scheduled import restrictions on electronic devices to enable Korean businesses to expand their investments in India. India is set to implement import restrictions on laptops, tablets, personal computers and other electronic devices from Nov. 1.
During the summit, Yoon and Modi also agreed to continue their cooperation for the smooth progress of India's second purchase of Korean-made K-9 self-propelled howitzers, and further expand defense industry partnerships.
Both leaders shared the view that technological cooperation between countries with shared values is becoming increasingly important and agreed to improve cooperation in advanced space technologies.
They also acknowledged that Korea and India, as like-minded countries, are establishing a strong framework for cooperation based on universal values such as freedom, human rights, and the rule of law. They pledged to cooperate in pursuing Seoul's Indo-Pacific strategy and India's vision for the Indo-Pacific.