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November 07, 2009
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| Korea’s parliament yesterday approved a trade agreement with India that would eliminate or reduce tariffs on over 4,400 Korean products exported to Asia’s third-biggest economy. Korea and India concluded the deal, called the Comprehensive Economic Partnership Agreement, in early August to cut duties on goods such as auto parts and electronics and to boost cooperation between the two Asian economic powerhouses. The bill passed 192-0 with five abstentions by the 299-seat National Assembly. The accord will likely take effect on Jan. 1 next year if ratified in both countries as scheduled. The CEPA, which is similar to a free trade agreement but phases out tariffs more slowly, will lower tariffs on auto parts by 1 to 5 percent in eight years. The pact is expected to boost bilateral trade by as much as $3.3 billion annually, according to estimates by the state-run Korea Institute for International Economic Policy. Bilateral trade between Korea and India reached $15.6 billion last year. “It is very meaningful that Korea forged a trade pact with India, one of the BRIC countries,” said Park Dae-shik, vice executive of the Federation of Korean Industries, Korea’s largest business lobby. “The deal will help further increase bilateral trade.” Indeed, the deal is the first of its kind between Korea, Asia’s fourth-largest economy, and a member of the BRIC group of fast-growing developing economies, comprising Brazil, Russia, India and China. Korea will be the second country after Singapore to sign such a treaty with India. “Bilateral relations will be further solidified, and the CEPA sends signals to the world that the two countries are committed to free trade and are against protectionism,” Korean Trade Minister Kim Jong-hoon said in August after signing the trade pact. Yonhap |
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