South Korean President Moon Jae-in, who began his first state visit to India on July 8, is scheduled to hold talks with Prime Minister Narendra Modi today (July 10) on several bilateral issues and ink partnerships in the economic sphere.
The President, who is on a four-day tour with his wife Kim Jung-sook, visited the iconic Akshardham temple on Monday and said the two countries may have different cultures but share common values such as peace, harmony, and unity in diversity.
World’s Biggest Mobile Factory
Later during the day, Moon and Modi inaugurated the world’s largest mobile factory. South Korean conglomerate Samsung Electronics’ factory will have a capacity of making 120 million handsets a year – nearly double the current 68 million – under a phased expansion by 2020.
Samsung said it has invested around Rs 5,000 crore to increase the capacity at the manufacturing plant, where it will fabricate devices ranging from low-end smartphones that cost under US$100 to the company’s flagship S9 model. The capacity increase is in line with Samsung’s plans to expand production that will help it compete with its Chinese rivals in the Indian market.
During their bilateral talks the two sides are likely to sign an updated Comprehensive Economic Partnership Agreement (CEPA).
The two sides are also likely to form a Korea-India Future Vision Strategy Group, which will identify research projects and exchange programmes on software, biotech, cyber security, healthcare and energy, media reports said.
Moon’s visit is significant in Asia’s changing political landscape. It comes soon after the summit between him and North Korean leader Kim Jong-un, and a meeting between Kim and US President Donald Trump in Singapore last month.
India has been propagating its Look East Policy for a while. Soon after Moon landed in India, Raveesh Kumar, the spokesperson for Ministry of External tweeted, “Indispensable partner in our ‘Act East’ strategy!”
South Korea is seen as a valued economic partner by India, and trade and economic relations have started to gather momentum again following the implementation of CEPA in 2010. Bilateral trade in 2011 crossed US$20.5 billion, registering a 70-per cent growth over a two-year period, the Indian Express reported.
However, bilateral trade declined to US$18.13 billion in 2014-15, US$16.56 billion in 2015-16, US$16.82 billion in 2016-17, which finally recovered and posted a positive growth of 30 per cent in the first seven months of 2017.
According to Statistics Korea, a Korean agency, Indian exports to the country accounted for US$2.91 billion and imports accounted for US$8.707 billion during January-July 2017, marking a growth of 26 per cent and 30.1 per cent, respectively.
Korea & India
India, too, features prominently in Moon’s “new southern policy” that aims at boosting ties with India as well as South-East Asian countries.
The Korea Herald said Moon’s visit will include a bilateral summit with the Indian Prime Minister on ways to further improve their countries’ relationship. Moon’s trip to India comes at an invitation from the Indian Prime Minister, who was one of the few global leaders to congratulate Moon on his election last year.
“India is fast becoming a major power with the fastest growing economy in Asia. It is also a key nation for cooperation under the New Southern Policy that our government is actively pursuing,” Cheong Wa Dae spokesman Kim Eui-kyeom said earlier.
The Moon-Modi summit, to be held on July 10, will mark the second of its kind as the leaders first met on the sidelines of the Group of 20 summit held in Germany last year.
The two leaders are widely expected to discuss ways to boost the countries’ economic cooperation and boost bilateral trade.
“We expect the trip to be an important opportunity to strengthen friendship and trust between the leaders and to create a basis for the development of our country‘s complementary and mutually beneficial cooperation with India and Singapore to establish future-oriented and strategic relations with the countries,” the Korea Herald quoted Nam Gwan-pyo, a senior director of the presidential National Security Office as saying.
The Posco Fiasco
Moon’s visit comes nearly three years after Modi visited South Korea in 2015 for talks with then South Korean President Park Geun-hye.
Ties were then elevated to “special strategic partnership” with Modi seeking South Korean investments in many flagship programmes of the government including “Skill India” and “Make in India.” A financing arrangement of US$10 billion had been set by South Korea for infrastructure development in India, following the visit, the Mint reported.
Moon has pledged to elevate its ties with India to the level of Korea’s relations with the four major powers in and around the Korean Peninsula – China, Japan, Russia and the United States, the report added.
“We expect the visit to open new partnership particularly in economic domain. Republic of Korea is a valued partner. Our bilateral trade last year passed US$20 billion and investments are also rising,” Kumar had told reporters ahead of the leader’s visit.
India’s relations had seen a downslide when South Korean steel major Posco scrapped its plan to set up a 12-million tonne (mt) steel mill in Paradip in the northeastern Indian state of Odisha.
However, the two countries seem to have gotten over the US$12 billion deal gone wrong. The proposal was seen as India’s largest foreign direct investment plan. But the South Korean firm pulled out of the project last year, after waiting for 12 years for clearances and being caught up in public resistance to the project.
“Posco was certainly an unhappy experience. But I think that has been left behind with South Korean investments worth US$600 million coming in last year,” The Mint quoted a senior diplomat as saying.
The South Korean President is accompanied by a delegation of senior members of his cabinet as well as industry captains. His visit is aimed at further strengthening the Special Strategic Partnership between the two countries.
Moon will leave India on Wednesday to head for Singapore, where he will stay for a three-day state visit.
Moon’s trip to the two Southeast Asian nations is widely believed to be aimed at promoting his New Southern Policy, which seeks to greatly expand and improve Seoul‘s diplomatic and economic ties with its Asian neighbors, mainly India and the 10 member states of the Association of Southeast Asian Nations.
The South Korean leader has pledged to visit each and every one of the 10 Asean member countries before his single five-year term ends in 2022.
The Korean first lady, Kim Jung-sook, is likely to participate in a K-pop event in Delhi, in a bid to showcase it’s growing popularity in India.