India and South Korea Trade Relations

India and South Korea share a strong and growing trade partnership, driven by industries such as automobiles, electronics, steel, and defense. Over the years, both countries have worked to enhance economic cooperation through agreements like the Comprehensive Economic Partnership Agreement (CEPA), which was signed in 2010 to boost trade and investment.

Bilateral Trade Volume
  • Total trade between India and South Korea exceeded $27 billion in recent years.

  • India is South Korea’s 7th largest export destination.

  • South Korea is India’s 13th largest trading partner.

  • Both countries have set a target to increase bilateral trade to $50 billion by 2030.

Major Imports and Exports
(A) India’s Exports to South Korea

India primarily exports raw materials, energy products, and pharmaceuticals to South Korea. Key exports include:

  • Minerals & Iron Ore – Raw materials for steel production.

  • Petroleum Products – Refined oil and chemicals.

  • Pharmaceuticals – Generic medicines and healthcare products.

  • Textiles & Leather Goods – Indian fabrics, apparel, and leather exports.

(B) South Korea’s Exports to India

South Korea exports high-tech and industrial goods to India, including:

  • Electronics & Semiconductors – Samsung and LG dominate India’s electronics market.

  • Automobiles – Hyundai and Kia have strong manufacturing units in India.

  • Steel & Machinery – POSCO supplies steel to Indian industries.

  • Petrochemicals & Chemicals – Used in various Indian industries.

Major Investments
South Korean Companies in India
  • Hyundai and Kia Motors – Large manufacturing plants in India.

  • Samsung and LG – Leading brands in consumer electronics.

  • POSCO – Investments in India’s steel industry.

Indian Companies in South Korea
  • Tata Motors – Owns South Korean truck manufacturer Daewoo.

  • Mahindra & Mahindra – Acquired SsangYong Motor.

  • Infosys and Dr. Reddy’s – Expanding in South Korea’s IT and healthcare sectors.

Challenges in Trade
  • Trade Imbalance – India imports more from South Korea than it exports.

  • Regulatory Barriers – Indian businesses face challenges entering the South Korean market.

  • Global Economic Factors – Supply chain disruptions and economic slowdowns impact trade.

Future Prospects
  • CEPA Expansion – Both countries are negotiating to strengthen the trade agreement.

  • Emerging Sectors – Focus on green energy, AI, and digital technology.

  • Defense & Space Collaboration – Growing partnerships in military and space research.

Conclusion

India and South Korea have a strong and evolving trade relationship. With growing investments, trade agreements, and new areas of cooperation, both countries are working towards a more balanced and strategic economic partnership.