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South Korea seeks upgrade of FTA with India

Economic Times, India

South Korea seeks upgrade of FTA with India

By Dilasha Seth, ET Bureau

8 January 2014

NEW DELHI: South Korea is likely to press India for an upgrade of the bilateral free trade pact when finance ministers of the two countries meet on Wednesday, arguing that its rival Japan was offered a better deal. However, India is unlikely to immediately revise the Comprehensive Economic Partnership Agreement (CEPA) signed in 2009, an official told ET.

The matter is expected to come up for discussion when finance minister P Chidambaram meets his counterpart Hyun Oh-seok to discuss bilateral trade and investment. South Korea wants to get zero-tariff access into India’s market for auto and steel, among other goods, a person familiar with the matter said.

"South Korea is very keen on upgrading the CEPA. However, we feel that it is too early to revise it. Moreover, we are in the process of studying the FTAs we have signed so far. So, until that process is over, we will not be able to revise the CEPA," a commerce department official said.

South Korea’s trade minister is also likely to visit India in the third week of January and meet commerce and industry minister Anand Sharma, indicating the high priority the country gives to the revision of the CEPA.

India and South Korea will also discuss revision of the Korea-India Double Taxation Convention (DTAC), bilateral cooperation between supervising agencies in the financial sector and cooperation in the process to obtain permission for establishing branches of South Korea’s commercial banks in India.