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Korea and India hold 9th round of CEPA upgrading negotiations 2022-11-03

The Ministry of Trade, Industry and Energy (MOTIE) announced that the 9th round of Korea-India negotiations for an upgraded Comprehensive Economic Partnership Agreement (CEPA) are to be held on November 3-4 in Seoul.

The Korean delegation is headed by Director General for FTA Policy Yang Gi-uk, while India’s is headed by Joint Secretary at Department of Commerce Anant Swarup. Relevant ministries including the Ministry of Economy and Finance (MOEF) and the Ministry of Agriculture, Food and Rural Affairs (MAFRA) also participate in Korea’s delegation.

The two countries have been discussing upgrading the Korea-India CEPA through eight official negotiation rounds since its beginning in June 2016, but after their eighth round in June 2019, COVID and other factors had stalled further progress.

Accordingly, the three-year hiatus is broken by this 9th round of official negotiations, through which both sides plan to keep seeking out ways to improve the deal in terms of investment, origin rules and tariffs on goods and services.

They also look forward to holding joint working group meetings on SPS (Sanitary and phytosanitary measures) and TBT (Technical Barriers to Trade) on the side, so as to communicate the difficulties in CEPA implementation as part of efforts to improve the bilateral pact.

India is a huge market with a 1.4 billion population, a country that is still achieving high growth rates (8.9 percent in 2021). As the world’s supply chain is being realigned, India is actively pushing FTA agreements with major countries in order to nurture its manufacturing industry and weave itself deeper into the global supply net.

Korean companies are currently entering various sectors of the Indian market with mobile phones and automobiles, with Samsung smartphones (20 percent) and Hyundai Motor cars (15.8 percent) both taking up second largest market shares in their respective categories. Korea-India trade volume hit an all-time high in 2021 ($23.7 billion), but that of 2022 ($22.0 billion as of September) is forecast to surpass that yet again.

Director General Yang remarked that “cooperation with India is all the more critical as the global economy faces unprecedented uncertainties,” and relayed that the CEPA upgrade will be an opportunity to expand trade, investment and economic collaboration with India, while also creating a broader foothold for Korea firms to enter the Indian market.