India Korea Trade Agreement
India Korea Trade Agreement: An Insight into the Comprehensive Economic Partnership Agreement
India and South Korea have a history of strong bilateral relations since the establishment of diplomatic ties in 1973. Over the years, the two countries have developed a significant economic relationship, which has been strengthened by the Comprehensive Economic Partnership Agreement (CEPA) signed in 2009. The CEPA is a landmark agreement aimed at enhancing economic cooperation between the two countries by reducing trade barriers and promoting investment.
The CEPA covers a wide range of sectors, including manufacturing, services, and investment. The agreement aims to increase the trade volume between India and South Korea by removing or reducing tariffs on goods and services. It also facilitates the movement of professionals and investors between the two countries.
Under the CEPA, South Korea has offered India duty-free access to its market for over 98% of its products and India has reciprocated by offering South Korea duty-free access to 75% of its products. This has resulted in an increase in trade between the two countries. In 2019, the bilateral trade between India and South Korea stood at $21.5 billion.
One of the significant benefits of the CEPA is the promotion of investment between the two countries. South Korean companies have invested heavily in India in sectors such as electronics, automobiles, and infrastructure. Similarly, Indian companies have invested in South Korea`s technology and automobile sectors. The CEPA has also facilitated the movement of professionals between the two countries, which has enhanced the exchange of knowledge and technology.
The CEPA has also brought about a positive impact on the service sector. The agreement has opened up new opportunities for Indian service providers in South Korea, particularly in sectors such as information technology, healthcare, and education. South Korean service providers, on the other hand, have achieved easy access to the Indian market, particularly in sectors such as tourism, healthcare, and legal services.
The CEPA has also brought about significant benefits for consumers in both countries. With the reduction or removal of tariffs, South Korean products have become more affordable in the Indian market. Similarly, Indian products have become more accessible in the South Korean market.
In conclusion, the India Korea Trade Agreement, through the Comprehensive Economic Partnership Agreement (CEPA), has brought significant benefits for both countries. The agreement has enhanced economic cooperation, increased bilateral trade, and promoted investment and the movement of professionals between India and South Korea. The CEPA has opened up new opportunities in the manufacturing and service sectors, benefiting businesses and consumers in both countries. The India Korea Trade Agreement is an excellent example of how free trade agreements can bring about significant economic benefits for participating countries.
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