‘Chips to ships’: India and South Korea target $50 bn trade by 2030, Pg1

Key Highlights:

• India and South Korea aim to increase bilateral trade to $50 billion by 2030 from the current $27 billion.
• Negotiations will restart to upgrade the Comprehensive Economic Partnership Agreement (CEPA).
• Agreements were signed to boost cooperation in Artificial Intelligence, SMEs, sports, and culture.
• A joint strategic vision was agreed upon for the India-South Korea special strategic partnership.

Detailed Insights:

• The existing CEPA, in effect since 2010, has increased bilateral trade from US$ 14.2 billion to US$ 26.89 billion in 2024-25, but India's exports remain significantly lower than imports.
• Initiatives such as the India-Korea Financial Forum, Industrial Cooperation Committee, and Economic Security Dialogue are being launched to facilitate financial flows and strengthen business cooperation.
• An India-Korea Digital Bridge will be established to deepen partnerships in AI, semiconductors, and IT, along with MoUs in shipbuilding, sustainability, steel, and ports.
• A Korean Industrial Township will be established to facilitate the entry of Korean companies, especially SMEs, into India.

Key Concepts Involved:

• Comprehensive Economic Partnership Agreement (CEPA): A trade agreement between two countries to reduce or eliminate tariffs and promote trade in goods, services, and investments.
• Small and Medium Enterprises (SMEs): Businesses that maintain revenues, assets or a number of employees below a certain threshold.
• Artificial Intelligence (AI): The simulation of human intelligence processes by computer systems.