India, South Korea to Expedite Upgrade of Comprehensive Economic Partnership Agreement, Aims for 18% Annual Growth to Double Trade by 2030
India and South Korea to Enhance Economic Partnership
India and South Korea have agreed to accelerate and upgrade the Comprehensive Economic Partnership Agreement (CEPA) to overcome issues related to non-tariff barriers and rules of origin. This move aims to shift the partnership towards a more balanced one, rather than being defined by significant trade deficits. The agreement was announced by Commerce Minister Piyush Goyal on April 20.
The current bilateral trade between India and South Korea stands at approximately $27 billion, with both sides aiming to double it by 2030. This ambitious target implies a steep growth trajectory over the next few years. In order to achieve this goal, the two nations have agreed to fast-track and upgrade the CEPA, addressing several non-tariff barriers and easing rules of origin to make it easier to do business between them.
South Korean President Lee Jae Myung emphasized the potential for growth in the relationship, citing the scale of India's economy. He expressed confidence that bilateral trade could more than double in the near future and called for expanding trade and investment cooperation. Both sides have highlighted opportunities for collaboration in sectors such as semiconductors, electronics, electric mobility, green energy, shipbuilding, and digital trade.
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The Comprehensive Economic Partnership Agreement between India and South Korea was signed on August 7, 2009, in Seoul and came into force on January 1, 2010. Negotiations to upgrade the deal have been ongoing, with the two countries working towards achieving a $50 billion trade target by 2030. To further boost investments, India plans to set up a dedicated Korean industrial enclave to encourage more firms from South Korea to tap into the country's domestic demand and its expanding network of trade agreements.
| Quarter/Year | Bilateral Trade (USD billion) | Growth Rate |
|---|---|---|
| Current | 27 | - |
| 2030 (target) | 54 | 100% (doubling) |
Key Dates
- August 7, 2009: Comprehensive Economic Partnership Agreement signed in Seoul
- January 1, 2010: Agreement came into force
- 2030: Target to achieve $50 billion trade target
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Key Figures
- Piyush Goyal: Commerce Minister of India
- Lee Jae Myung: President of South Korea
Investor Takeaway
India and South Korea aim to double trade by 2030, implying a steep growth trajectory.
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