by Choe Nam-suk
President Park Guen-hye had a summit meeting Prime Minister Navendra Modi of India in India on Sept. 8, 2016, and agreed on the expansion of economic cooperation between the two countries, including expansion of Korean investments in India.
Korea and India are coming rapidly closer together in various fields, especially in the area of economic cooperation.
What’s pushing the two countries to come closer together?
There could be many reasons. However, looming large on the surface are the markedly declining signs in the picture of Korean-Chinese economic cooperation. Then come the signs of increasing competition among Korean companies entering Vietnam.
India, against this backdrop, looms larger and larger among Korean companies as one of the most promising target countries to increase their investment.
Against this backdrop, The Korea Post media (consisting of two Korean news publications and three English media, including a real time-updated English Internet daily), interviewed President Dilip Sundaram of the Chamber of Commerce &Industry of India in Korea. Excerpts from the interview follow:
Question: What is the recent development between Korea and India in terms of promotion of bilateral economic cooperation?
Answer:First of all, The Defense Minister of India, Mr. Manohar Parrikar, visited Korea during last year. ICCK and the Embassy of India, Korea Defense Industry Association (KDIA) and Korea’s Defense Acquisition Program Administration (DAPA) organized the largest ever India-Korea Defense Cooperation Meet, that bringing together a record number of Korean and Indian defense suppliers and government officials leading to renewed engagements in several key sectors of defense industry, especially shipbuilding and joint research & development of critical defense technologies.
Q: Who are the Korean companies interested in the project?
A:Several Korean shipbuilding majors are close to finalizing strategic partnerships with leading Indian shipyards. The Kangnam Group, a leading Korean shipbuilding company is close to concluding a crucial agreement with the Goa Shipyard to manufacture mine sweepers in Goa under the “Make In India” Program. Further, a consortium of Korean companies like Hanwha Techwin together with the Indian company-L&T is all set to win a mega contract to manufacture the 155 mm self-propelled artillery guns in India. Doosan is actively participating in another large program for its air defense gun missile system (BIHO). Korean defense majors like LIG Nex1 and Doosan DST are participating in major Indian defense programs. In addition, India’s DRDO and
Korea’s ADD have established joint R&D programs in key defense technologies. All theseengagements are likely to lead to firm contracts worth billions of dollars leading to a major boost to the bilateral trade between India and Korea.
Q: Please explain the activities of your Chamber:
A:ICCK is a non-political, non-profit organization. Our mission is to serve as the nodal organization to help state & provincial governments and businesses in India and Korea to maximize economic and cultural opportunities.
ICCK was established in 2010 and in order to improve ICCK’s governance and transparency, it was last year that we drafted and adopted our first formal constitution.
Our vision is to play a vital and valuable role in the economic development and trade promotion between India and Korea. We realize the vision by fostering economic development and enhance the quality of trade between India and Korea.
These are our key value that we want to deliver.
1. AWARENESS: we share business and cultural information on India to Korean businesses and on Korea to Indian businesses.
2. DEVELOPMENT: we promote Indian investment in Korea and Korean investment in India that leads to economic and cultural development.
3. ADVOCACY: We advocate and support trade policies that increase commercial relations between the two countries and improve the quality of trade.
We take great pride in not only its accomplishments but also in the manner in which accomplishments are achieved. Our accomplishments are rooted in a strong sense of Indian and Korean values. And we achieve our vision with your help when you volunteer your valuable time, donate generously, and actively participate in ICCK organized events.
Q: We understand that you also organize important seminars. Please introduce them.
A: ICCK hosted the State Governments of Punjab and Madhya Pradesh and organized seminars to attract Korean investment to the two States. Also, we organized 40 B2B Meetings to facilitate and promote trade relations. We executed MOUs for cooperation and investment promotion with Punjab and Madhya Pradesh.
Furthermore, ICCK and the Embassy of India, organized the Defense Industry Forum in April 2015 with around 120 attendees and the Marine Supply Chain Forum in July 2015 with over 180 attendees. The Marine Supply Chain Forum is a key initiative to promote the presence of an efficient Korean shipbuilding ancillary industry in India, thereby developing India into a major Maritime nation. The Marine Supply Chain Forum brought together all major Indian shipyards connecting directly with the Korea’s marine equipment, component and system suppliers to address a US$ 30 billion marine market in India in the medium term.
ICCK in concert with MOTIE organized an investment tour to India for about 20 Korean companies in June 2016. This trip was very well received and more are being planned over the course of the next few months.
Lastly, In October 2016, ICCK hosted the State Governments of Gujarat’s visit to Korea and organized seminars to attract Korean investment to the State of Gujarat.
Background information on Korea-India cooperation:
According to the Embassy of India in Seoul, the trade and economic relations between India and Republic of Korea (Korea) have gathered momentum in recent years with bilateral trade reaching a substantial figure of $16.27 billion in 2015.India is the 13thlargest trade partner of Korea. Bilateral Comprehensive Economic Cooperation Agreement (CEPA) has spurred the process. Investments both ways are on the upswing.Korean majors such as Hyundai Motors, Samsung Electronics, LG, etc., which have invested around $3.91billiontill December 2015 in India, have plans to expand further. Actual Indian FDI led by Mahindra & Mahindra (Ssangyong Motors), Aditya Birla Group (Novelis Ltd.) & TATA (Tata Daewoo commercial vehicles) also is inching close to $3 billion.
Bilateral economic ties received a visible boost from the visit of Prime Minister Narendra Modi to Republic of Korea from 18-19 May 2015. India and Korea decided to commence negotiations to amend the CEPA by June 2016, strengthen cooperation on energy, electronics and shipbuilding industries, including setting up of a Joint Working Group for Cooperation on the Shipbuilding sector and another in the field of Electronics Hardware manufacturing. ROK offered to provide US$10 billion financing to India for priority projects. Recognizing the importance of shipping industry in the bilateral relationship, PM also visited Shipyard of Hyundai Heavy Industries in Ulsan. PM & President Park addressed the inaugural session of India-Korea CEOs Forum to promote the bilateral economic cooperation, while PM also met the leadership of the top Korean conglomerates. Prime Minister also offered to create a “Korea Plus” group as a single window in India to address all the issues raised by Korean companies.