Korea-India CEPA Ratified by Nat’l Assembly
Chosun Ilbo. Korea
Korea-India CEPA Ratified by Nat’l Assembly
9 November 2009
The National Assembly on Friday ratified a trade deal with India, called the Comprehensive Economic Partnership Agreement (CEPA), that will eliminate or reduce tariffs on over 4,000 Korean goods.
Under the deal, Korea will eliminate or reduce tariffs on 90 percent of Indian products over the next decade while India is to phase out tariffs on 85 percent of Korean exports within the same period.
The two countries wrapped up more than three years of bilateral trade negotiations in early August after agreeing to cut duties on goods such as auto parts and electronics.
According to the state-run Korea Institute for International Economic Policy, the pact will boost bilateral trade by as much as US$3.3 billion annually and raise Korea’s GDP by W1.3 trillion (US$1=W1,169).
Trade Minister Kim Jong-hoon has said that the deal will further solidify bilateral relations, while other experts forecast that the overall economic impact of the CEPA will turn out to be greater in the long-run.
Although the level of market opening is relatively low for Korea compared to free trade agreements with the United States and the European Union, the deal is poised to open up the Indian market more than for any other foreign country.
It is the 13th free trade deal that India has concluded and its first with an East Asian country. For Korea, the CEPA is especially significant in that it is the first to be finalized with a BRIC nation, comprised of Brazil, Russia, India and China.
The trade pact will go into effect starting Jan. 1 as India has already finalized domestic protocols to implement the deal.
