‘India not gaining from trade pact with South Korea’

June 24th, 2011 - 8:14 pm ICT by IANS  

Chennai, June 24 (IANS) While South Korea is taking advantage of a bilateral trade pact with India, Indian exporters are not advantaging from it, speakers at a seminar said here Friday.

India and South Korea signed the Comprehensive Economic Partnership Agreement (CEPA) in 2010, whereby the two countries reduced import duties on various products with a view to increase bilateral trade.

“South Korea, with its high value exports, has been able to benefit from the CEPA but the same cannot be said for India, as its exports are of low value,” said B. Sriram, director at the consultancy firm PricewaterhouseCoopers (PWC).

Speaking at the Indo-Korea Connect 2011 - International Business Summit here, Sriram said: “South Korea has agreed to reduce import tariff on nearly 95 percent of the items whereas India has agreed to limit that to 80 percent of the dutiable products. However, most of the automobile products are kept out of the CEPA.”

According to him, more than imports, the CEPA is expected to increase South Korean investments in India in the fields of semi-conductors, plastics, auto parts, agriculture, textiles, multimedia and ceramic products, among others.

He said Indian businessmen have to be aware of CEPA while deciding their business plans so that they are not caught on the wrong foot later.

“The list of items mentioned in the CEPA is not static. Industry players can approach the Indian government to include their sector in the trade pact,” Sriram added.

According to S. Sivagnanam, director in the union ministry of micro, small and medium enterprises, India is the 13th largest trade partner of South Korea. Bilateral trade between the two nations in 2010 was around $17 billion.

He said there are around 160 Korean companies in Tamil Nadu and 3,000 Koreans live in the state, out of around 8,000 in India.

Referring to the CEPA, J.S. Ham, vice president of Samsung Electronics India Ltd, said South Korean companies in the fields of automobile, technology and other sectors are interested in investing in India.

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