Korea to Sign Major Trade Deal With India

Qualified computer programmers, business consultants and assistant teachers of English from India will be allowed to work in Korea from January next year.

Korean exports to the world’s fourth-largest economy will surge as India is expected to lower tariffs on Korean car parts and ships.

Before officially signing a comprehensive economic partnership agreement today, the trade negotiation headquarters of the Korean Foreign Affairs and Trade Ministry released details of its agreement yesterday.

The agreement provides for comprehensive cooperation across all economic sectors and is considered equivalent to a free trade agreement.

India had a per capita income of 1,052 U.S. dollars last year, but a purchasing power GDP of 3.3 trillion dollars and a population of 1.15 billion. The country is the world’s fourth-largest market, following the U.S., China and Japan.

Under the agreement, Korea will abolish or lower tariffs on 93 percent of Indian imports by volume (or 90 percent by value) within ten years after the agreement takes effect. For its part, India will abolish or lower its tariffs on 85 percent of Korean imports by volume (or 85 percent by value).

An official from the Korean Strategy and Finance Ministry’s free trade task force said, “The CEPA will be the first free trade agreement with one of the BRICs (Brazil, Russia, India, and China). Korea is expected to gain first-mover advantage after signing the deal ahead of other major economies like the European Union, China and Japan.”

Seoul will ask the National Assembly to ratify the agreement with India at next month’s regular session. The Indian Cabinet approved the deal last month, so the agreement will take effect 60 days after the Korean parliament ratifies it.

Seoul and New Delhi say the agreement will take effect Jan. 1 next year. Excluded from the deal are imports of agricultural, marine and stockbreeding products such as rice, beef, pork, red pepper, garlic and onions.

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