Published on : May 19, 2015
In a move to strengthen Comprehensive Economic Partnership Agreement (CEPA), the Indian and Korean governments will start negotiations in next June or earlier.
As per the CEPA in its present form, India receives a mere 85% concession for tariff and nothing less than 13.8% of trade items enjoys incomplete elimination of tariff. Also, the CEPA rate use stand at 56.3% for export activities and 67% for import activities. The rates are much lower compared to KORUS FTA (which is 76%), Korea Chile (which is at 80%), and Korea EU FTA (which is at 85%).
It is estimated the Korean government will extend financial support as much as US$10 billion for infrastructure activities in India. To keep with the move, Korean companies will receive opportunities for participation in purification projects of the Ganges River, construction of high speed railway, development of alternative energy, and construction of smart grid.
In the present scenario, the power supply in India has 75% standing. AS per planning of the Indian government, there are propositions to invest US$100 billion in areas such as alternate energy and construction of smart grids by 2020.
In addition to this, India has made promise that in the Prime Minister’s Office Korea Plus Center be set up. This will aid Korean companies doing business in India to cope up with regional difficulties.
In the interim, Prime Minister of India Narendra Modi had a meeting with Group Chairman of Hyundai Motors Chung Mong-koo to discuss on the construction of third plant in India. The other meetings that are scheduled are between Indian Prime Minister and President Samsung Electronics Shin Jong-kyun and chairman at POSCO Kwon Oh-joon.