By Publisher Lee Kyung-sik with Kim Tae-moon, Ms. Sua Kim
Commercial Officer Ms. Nayantara Dabariya at the Embassy of India in Seoul said: “Korea is already an integral part of India’s ‘Look East Policy’ and ‘Act East Policy’. India is moving very fast with over 7% growth rate which is higher than most other emerging market economies. We consider Korea as a partner country in accelerating the economic growth in India.”
Commercial Officer Ms. Dabariya made the statement at a recent interview with The Korea Post media, owner and operator 3 English and 2 Korean-language mass communications media outlets in Seoul established 33 years ago.
Her statement comes pat to the rising opinion among the Korean businessmen who are considering expansion of their business to countries with a bright outlook.
India, who sent a medical battalion to help Korea in time of dire need during the Korean War of 1950-3, is largely received very well in Korea for her gentle, non-aggressive Oriental characteristics which Koreans think are similar to theirs.
From our interview with Ms. Dabariya, it was immediately apparent that India had many attractive things in store for Korean businesses want to expand or relocate their business operations. Details of the interview follow:
Question: Does your country have any plan to invite Korean companies to invest in your country? Many Korean companies are seeking new investment destination countries following the unfavorable conditions increasing in such countries as China.
Answer: Yes, we do have plans to invite Korean companies in India to explore opportunities of trade and investment. South Korea is already an integral part of India’s ‘Look East Policy’ and ‘Act East Policy’. India is moving very fast with over 7% growth rate which is higher than most other emerging market economies. We consider South Korea as a partner country in accelerating the economic growth in India.
We seek robust economic engagement between Indian and Korean economies. In order to achieve this goal, India and Korea jointly established Korea plus in June 2016. Korea Plus, first-of-its-kind investor supporting cell, is dedicated cell to promote, facilitate and hand-hold Korean investment into India and assist them throughout the life cycle of the project.
To disseminate information about existing economic opportunities, Ministry of Commerce and Industry of India in partnership of Chosun Ilbo Group and KOTRA organized 2nd edition of India-Korea Business Summit in Feb, 2018, wherein 350 delegates from 84 Korean companies participated and interacted with 400 top Indian companies. All of these efforts have resulted in significant growth in bilateral trade from USD15.78 Billion in 2016 to USD 20.5 Billion in Dec, 2017. India would join top 10 bilateral trade partner group of South Korea very soon at this rate and is already 6th largest destination for Korean Exports. Simultaneously, Korean major companies have invested to the tune of USD 4.90 Billion in various sectors of Indian economy whereas figures amounts to USD 3 Billion for Indian investment led by Mahindra and Mahindra (Ssangyong Motors), Tata( Tata Daewoo Commercial vehicles) and Novelis Ltd. in South Korea.
With ongoing economic reforms and further liberalization of Indian economy, pool of skilled professionals, growing market demand and ‘Make in India’ initiative, India invites Korean companies to make India as their global base for manufacturing and be partner in strategic growth.
Q: What are the specific areas where you might want Korean companies to invest? Please elaborate.
A: ‘Make in India’ initiative of India includes 25 main industries where opportunities of investment are abundant. Among those 25 sectors, I consider food processing, textile, automotive parts, entertainment, chemicals, electronic system design and manufacturing (ESDM), ship building and defense, infrastructure to be most compatible sectors vis-a-vis the Korean technology and expertise. To elaborate, India is largest producer of grains and 2nd largest in fruits and vegetables but it has gap in food processing capacity and Korean technology can bridge this gap. Similarly, India has set goal to increase share of manufacturing in GDP from current 16% to 25% by 2022.
With increasing level of income, (India is 3rd largest country after USA and China in terms of Purchasing Power Parity) demand for not only white consumer goods is going up rapidly but also demand for state-of-art infrastructure is very conspicuous. Currently, more than 600 Korean companies are working in India in different sectors and Korean Brands e.g. LG, Samsung, Hyundai are popular brands among Indians. To fulfill infrastructure demand, major initiatives have been taken up for Railway station modernization, metro-rails, roadways, airports, Port development and industrial corridors, river inland waterways & related industries and smart cities and Korean companies are being invited to participate in the projects.
Many major Korean companies have partnered with Indian companies recently to manufacture domestically in India. To give an example, Korean defense major, Hanwa Techwin has joined hands with Indian Larsen & Toubro to manufacture self-propelled howitzers for Indian Army. CJ logistics has acquired stakes in Indian transport and logistics company Darcl Logistics to strengthen its presence in India to tap logistics sector demand of India. Besides, many Korean companies including-Kia Motors, Youngone Corporation, Hyosung Corporation have already announced their plan to invest in various sectors of India.
Q: Who are the Korean companies doing well in India? Please present their names and contact information for the prospective Korean companies who want to enter India?
A: The Korean companies actively engaged in business in India include the following:
HSI Automotives Ltd.
KOMOS Automotive India
Woosu Automotive India
Dae Seung Auto Parts
Myunghwa Automobile India
YSI Automotive Pvt., Ltd.
KOTEC Automotive Services India
Q: Does your country offer any incentives to the good Korean companies wishing to invest in your country? Please specify such offers.
A: Yes, there are various kind of incentive available to overseas companies. To encourage foreign investors, India has number of Special Economic Zone (SEZ), National Investment and Manufacturing Zone and Export Oriented Units which are considered as foreign territories in context of tax and custom e.g. companies in SEZ are eligible for total exemption for tax for first 5 year and 50% exemption from tax due for next 5 year and tax holiday is bigger for various sectors. Additionally, there are investment allowance at the rate 15%, export incentives e.g. - duty drawback, duty exemption. Area based incentives applies for units set up in North eastern states, Himachal Pradesh, Uttarakhand and Jammu and Kashmir. Then, there are sector specific incentives like Modified special incentive package (M-SIPS) in electronics. Moreover, there are State specific incentives also available. An exclusive Korean Industrial Zone is being developed in Giloth of Rajasthan State to support Korean investments and businesses in India. Additionally, another state Andhra Pradesh is planning to establish Korean township for Korean entrepreneurs.
Government of India opening major sector for private players and 100% FDI under automatic route is permitted including Railways, duty free shops, single brand retails, e-commerce, white label ATM, animal husbandry, financial services, satellite related activities, aviation sector, teleport, Mobile TV, cable networks, construction development sector, among others.
Government of India has rolled out Goods and Services Tax (GST) last year replacing various indirect taxes on supply of goods and services establishing India as unified single market. The step is in tandem of streamlining of tax regime in India. India jumped 30 ranks up into top 100 in this year owing to improvement in insolvency laws, bankruptcy laws, protection of minority stakeholders etc. Pace of economic reforms is unprecedented and Korean businesses are welcome to derive benefit of all these reforms and incentives.
Q: Does your country have any specific items to purchase from, or export to, Korea? Please elaborate because Korean companies now wish to drastically increase their interaction with such companies.
A: If you look at traded commodities in bilateral trade South Korea is champion in export of industrial goods whereas intermediate goods, semi processed agri goods are forte of India. India has variety of goods to offer to south Korea. Varieties of grains-rice, wheat, spices, maize, corn, sesame seeds, tea, coffee, marine products-shrimps and prone, fresh/frozen fishes, Fresh/frozen Pork and beef, beers, Indian vegetable and fruits and fruit concentrates (last year we started export of Indian Mango in South Korea which received very good review), processed foods, generic medicines and bio-similars. These products go through WTO guidelines on Sanitary Phyto Sanitary rules. Hence, market for some of products still not accessible for both side traders. Comprehensive Economic Partnership Agreement (CEPA) upgradation negotiations are going on for expansion of scope of tradable goods and services.
Q: What are the areas where your country wishes to increase cooperation with Korean companies?
A: India and South Korea are special strategic partners which has potential to redefine this century. Both nations have synergies to complement each other’s requirements. In the time of economic retaliation and protectionist measures around the globe, India offers opportunity to South Korea to diversify its overseas market. India has benefits of young demography, massive market demand and progressive economic reforms whereas Korea expertise lies in skill development, infrastructure building and advanced technology. Infrastructure sector is one pf the key driver of growth in India. India needs about USD1.5 trillion investment in the infrastructure sector in the coming decade. Metro-rails, railway station upgradation,airports, highways, flyovers, smart Cities, affordable housing, construction, port development and logistics industry are sectors wherein Government of India is inviting foreign partners with state-of-art technology. India is eager to increase cooperation in ICT sector wherein concept of combination of Indian IT and Korean hardware could be realized. As you must be aware, India is pioneer in satellite communication technology, we are looking for joint partnership with Korea in space sector, too. Simultaneously, there is huge potential of partnership with Korean companies in defense sector owing to the fact that India is seeking to reduce its import bill and engaging technologically advanced foreign partners to produce defense equipment indigenously under ‘Make in India’ initiatives with attractive offset policy. People-to-people ties is an area which has not been realized to its fullest. We want more Korean people to go and visit India and know about its developments.
Q: Who is your government minister in charge of international trade and commerce with countries such as Korea? Please elaborate on the minister and provide us with a copy of his/her picture for publication.
A: Head of Ministry of Commerce and Industry is Mr. Suresh Prabhu. Minister Prabhu is a dynamic minister with more than 20 years of experience in Central Government. He has a vision as where India-Korea engagement could reach too. We are benefitting immensely from his inspiring leadership. (See biographical data at the end of this report.)
Q: Many Korean business people wish to have sufficient rest and recuperation. What are the tourist attractions in your country?
A: India is a treat for travelers from around the world. On one hand, the states of Rajasthan and Gujrat offers luxuries of heritage cities with spell-binding fortress, forts, Havelies (residential palaces of princes) with desert safari, on the other hand, there are numerous national Parks which offer shelter to varied wild life including- Asian lion and tigers, elephants among others. There are splendid temple complexes in each part of India- Madurai temple, Konark Sun temple, Amritsar golden temple and many more. Nature has endowed North-East states of India luxuriously which includes-Assam, Manipur, Meghalaya, Mizoram, Arunachal Pradesh, Nagaland, Tripura and Sikkim. With a coastline more than 7000 KM, India is blessed with mesmerizing beaches as well as island groups of Andaman and Nicobar. Cultural heritage of Varanasi, Buddhist circuit of Bihar and Madhya Pradesh is an eye-catcher, which could never be ignored by any travelers. India is a unique country which satisfies all budget ranges as well as curiosities of geographically diverse landscapes.
Q: Please introduce yourself fully as the prospective Korean business leaders might wish to meet with you in person.
A: I am currently working as commercial officer in Embassy of India, Seoul. I went to Yonsei university for one and half year to learn Korean language and to understand the Korean way of working and thinking. I am dealing with trade, commerce, investment, finance, media as part of my job profile. As a commercial officer, I am working towards better exchange of information between Indian and Korean businesses and better understanding of each other’s economic eco-system to create stakes for each other. I look forward to work with Korean business entities and facilitate their interaction with Indian counterparts.
Q: Please state whatever other important areas of coverage I might have inadvertently left out from the questionnaire.
A: Proposed VVIP visit of President Moon Jae In to India in month of July this is very timely since India is emphasizing on South Korea as technology partner. We are anticipating more robust dialogues and engagements from both the sides in economic, political, cultural and science and technology arenas and progressive efforts from both nations to realize the true potential of bilateral relations.
Biography of Minister Shri Suresh Prabhakar Prabhu of Commerce and Industry of India:
A Chartered Accountant armed with a Law degree Shri Suresh Prabhakar Prabhu, Hon’ble Minister for Commerce and Industry, Government of India is known as a man of action, having penchant for undertaking reforms and scripting turnarounds. He is well respected for his impeccable integrity, passion and commitment towards society at large.
Before assuming charge as the Minister for Commerce and Industry, he was the Minister for Railways. Under his leadership, Railways transformed from a slow moving behemoth into a fast, responsive organization. A complaint resolution mechanism through social media, innovative project financing by leveraging extra budgetary resources, quantum jump in infrastructure creation and integrating sustainability into the core strategy of Railways are just some of his successes. Four times Lok Sabha MP, he is currently representing Andhra Pradesh in The Rajya Sabha. As the Minister for Power he transformed the Indian power sector by introducing the landmark Electricity Act, 2003. He was chosen to Chair the Task Force for Interlinking of Rivers. Known for his passion for environment conservation, he also held the position of Minister for Environment and Forests. He was also the Minister for Chemical and Fertilizers and Minister for Industries. In his early career, he was the Chairman and Director of Saraswat Bank, and was also appointed as the Chairman of Maharashtra State Finance Commission. Mr. Prabhu is known as a global visionary and renowned thought leader. He has travelled to over 100 countries and engaged with various international forums. He featured among the top three Indian leaders of the future by Asia Week magazine, Hong Kong in its cover story "Giant on the Move.” He has been actively involved with a large number of social, cultural and Co-operative organizations. He is also the Chairperson of Manav Sadhan Vikas Sanstha, an NGO working towards empowerment of people.