Korea, India to set up 1st ministerial-level committee to deepen economic cooperation

President Lee Jae Myung speaks during the announcement of a joint post-summit statement with Indian Prime Minister Narendra Modi at India’s presidential palace in New Delhi, Monday. Yonhap

NEW DELHI — Korea and India agreed to set up their first ministerial-level committee dedicated to economic cooperation during a bilateral summit between President Lee Jae Myung and Indian Prime Minister Narendra Modi in New Delhi, Monday.

The committee will be tasked with strengthening bilateral cooperation in strategic sectors such as critical minerals, nuclear energy and clean energy.

To grapple with global energy disruptions due to the Middle East conflict, the two countries also agreed to ensure a stable supply of raw materials and products including naphtha.

“We agreed to upgrade the framework for economic cooperation between our two countries to generate new momentum for shared growth,” Lee said as he announced a joint statement with Modi at India’s presidential palace after the summit.

He expressed hope that the envisioned committee will boost bilateral cooperation beyond trade and investment.

To foster a more favorable environment for trade and investment, the two leaders agreed to accelerate negotiations on upgrading the Korea-India Comprehensive Economic Partnership Agreement (CEPA).

Signed in 2009, CEPA is aimed at eliminating import tariffs and expanding opportunities for investments as well as service sectors.

President Lee Jae Myung and Indian Prime Minister Narendra Modi, accompanied by their officials, hold a summit at India’s presidential palace in New Delhi, Monday. Yonhap

“The upgraded agreement will fully reflect new trade norms, enabling our two countries to respond in a timely manner to evolving trade conditions,” Lee said, listing out supply chains and the green economy as examples.

Additionally, a working-level consultative body will be established between the Korean Embassy in India and India’s regulatory authorities, enhancing systematic support for Korean small and medium-sized enterprises (SMEs) newly entering India.

All these cooperative efforts are expected to more than double bilateral trade — from the current annual level of about $25 billion — to $50 billion by 2030.

The summit addressed expanded cooperation in strategic industries to leverage the two countries’ respective competitiveness.

Among the related fields are artificial intelligence (AI), software, digital technology, shipbuilding, finance, cultural content and QR-based electronic payment systems.

In the presence of Lee and Modi, the corresponding ministers and officials from the countries signed a governmental-level memorandum of understanding (MOU).

According to Kim Yong-beom, presidential chief of staff for policy, Modi is considering the establishment of a control tower under his office to hear and settle difficulties faced by Korean businesses operating in India.

Modi is additionally considering hosting a special weekly campaign to promote Korean enterprises.

"The prime minister reckoned that India’s large scale, when combined with Korea’s speed, could benefit both sides," Kim said, with reference to the business competitiveness of each country.

The summit took place during Lee's three-day state visit to India from Sunday to Tuesday.

It is the first state visit to India in eight years by a Korean president, following the previous one by then-President Moon Jae-in in 2018.

The Lee administration regards India as a central partner in advancing its so-called Global South diplomacy.

India has the world’s largest population of 1.4 billion, the fourth-largest economy globally and robust annual growth of over 6 percent. It is regarded as a leading country in the Global South, a broad term used to describe countries generally considered to have developing or emerging economies and is not limited to the Southern Hemisphere.

India is especially seen as crucial to Lee’s pragmatic, interest-driven foreign policy amid the growing fragmentation of the global order, as well as to energy security considerations in the context of the ongoing conflict in the Middle East.

As for peace on the Korean Peninsula, Lee thanked India for its consistent support and expressed hope that it would continue “to play a constructive role in promoting peace.”