The model presented in the report estimates that South Korea could increase high-potential exports to India by almost USD1.5 billion annually, or 8 per cent of which most opportunities are found in goods exports (approximately USD1.2 billion). The top 5 sector export opportunities are - not surprisingly - vehicles, vehicle parts and accessories, but also knitted fabrics, financial services, man-made filaments, and pharmaceutical products.
India and South Korea - third and fourth largest economies in Asia respectively, after China and Japan - enjoy a close commercial connection and are bound by shared economic interests. South Korea’s open market policies have aligned with India’s “Look East” and “Act East” strategies, which aim to strengthen India’s relationship with other Asian counter parties.
“Over the past few months we have observed a significant growth in Trade Finance negotiations between Korea and other countries in the region.” Said Uon Kim, Sales Director, Asia at Mitigram.
In 2018, the Korean foreign direct investment into India crossed the milestone amount of USD 1Bn for the first time, as culmination of a few years of increased of relations and investments, fuelled by a number of business summits and agreements on trade and commerce.
According to the OECD TiVA database and goods exports from UN Comtrade data, there is an actual two-way trade in high potential sectors of USD 27Bn as the sum of services exports, excluding goods sectors where there is no or negligible opportunity to add value to the exported product (e.g. commodity or commodity-like sectors). The data is time-averaged for 2016-2018.
The stronger ties between the two economic giants has not only benefited their mutual relationships, but further positioned both India and Korea as pivotal markets in global economy and trade finance.