Indo-Korea trade talks on fast lane
Financial Express (India) | Friday, October 13, 2006
Indo-Korea trade talks on fast lane
HUMA SIDDIQUI
NEW DELHI, OCT 12: Negotiations on the Comprehensive Economic Partnership Agreement (CEPA) between India and South Korea, including goods, services and investments are on the fast track.
Two meetings of the India-Korea joint task force, scheduled later this month and in December, are slated to tie all the loose-ends in the negotiations. Sources told FE that South Korea was eager on early conclusion of CEPA, before discussion with Japan in December.
At the task force’s last meeting in July on tariff concessions, the Korean side had presented a framework based on three tracks - negative, sensitive and normal lists. Sources said while Korea had been insisting on discussions based on the negative lists in the services and investments, Indian officials were keen on positive lists.
In trade and goods, the Korean side has been seeking liberalisation of exports, free of duties. Promising to do the same, however, India has conveyed that it wants to retain duties, especially for certain sensitive items including leather.
Negotiators from the both sides discussed clarifying the place of origin of goods, lowering non-tariff barriers and making it easier to make investments.
The Indo-Korea CEPA talks are based on the India-Singapore model, where India wants mutual recognition agreements with Korea for engineers, dentistry, accountants, doctors and so on.
“This relationship offers a successful model for India to replicate with other countries, as this is the first time India is having negotiations with a Organisation for Economic Co-operation and Development (OECD) country,” said sources.
India had expressed its keenness to bring IT, tourism, science and technology under CECA, but without being subjected to dispute mechanism. The agreement is estimated to more than double the existing two-way trade between India and South Korea to $15 to $20 billion by 2010.
The agenda for the negotiation was divided into seven fields, namely goods, origin of goods, administration and procedures of taxes, trade in services, investment liberalisation, other trade regulations and cooperation, and conflict resolution and general regulations.
According to experts, India’s “Look East Policy,” launched in 1992, has not only helped the bilateral process, but also strengthened relations with northeast Asia and the Asean.
South Korea is the fifth largest investor in India and India is the fifteenth largest investor in Korea. Bilateral trade has witnessed a phenomenal growth since the opening up of the economy, registering a 40% rise during the financial year 2005-2006 compared with the previous financial year.
The two-way trade for the financial year 2005-2006 stands at $ 6391 million.
