Seoul (South Korea), Nov.6 (ANI): The South Korean National Assembly has ratified a free trade deal with India, opening the way for the elimination or lowering of tariffs on trade worth 15 billion dollars with Asia’s third largest economy.

The so-called the Comprehensive Economic Partnership Agreement (CEPA) would eliminate or reduce tariffs on over 4,400 South Korean export items.

During a regular parliamentary session on Friday, the trade bill was passed 192-0 with five abstentions by the 299-seat Assembly.

The pact is slated to take effect on Jan. 1, 2010 if approved in both countries as scheduled.

South Korea and India wrapped up their three-and-a-half-year-long bilateral trade talks in early August, which called for tariff reduction in auto and other manufacturing sectors in both countries.

The CEPA binds South Korea to phase out or reduce tariffs on 90 percent of Indian goods over 10 years, while India is to eliminate tariffs on 85 percent of South Korean exports within the same period.

The CEPA is different than the free trade agreements (FTA) in that it has a longer write-off period.

The pact is expected to boost bilateral trade by as much as 3.3 billion U.S. dollars annually, with South Korea’s trade to the market likely to grow 4 percent on year, the state-run Korea Institute for International Economic Policy (KIEP) said.

In the meantime, South Korea has been awaiting parliamentary ratifications on the South Korea-U.S. FTA in both countries, as its process has been slowed with some opposition groups urging it has to be modified in terms related to agriculture in South Korea and automobiles in the U.S.

The trade pact, which does not require ratification by India, could nearly double the volume of trade between the two sides.

The deal is the first by India with a developed economy and South Korea’s eighth free trade pact.

The South Korea-India deal will eliminate tariffs on three quarters of India’s imports from South Korea by value, and more than 80 percent of South Korea’s imports from India.

A study by the state-run Korea Institute for International Economic Policy said the pact could boost annual two-way trade by 3.3 billion dollars in the near term and raise South Korea’s GDP by 1.3 trillion won (1.06 billion dollars).

South Korea’s main exports to India are auto parts, petroleum products, and mobile phones. Its largest import from India is naphtha, accounting for more than half of imports in 2008. (ANI)