Elevating economic ties and signing a trade facilitation agreement will top the agenda when Prime Minister Narendra Modi makes his last foreign visit to South Korea starting from February 21 to 22.
The two-day visit by Prime Minister Modi could set a roadmap for increasing bilateral trade from $20 billion to $50 billion by 2030.
"India is a potentially big market. We would like to benefit from Make in India. Some countries are withdrawing from China as the market and its companies have become very competitive. It is not easy to compete with Chinese companies and so we need to explore new markets,” Shin Bongkil, South Korea’s Ambassador to India, told CNBC-TV18.
The envoy highlighted India's investment climate is much better than before and many Korean companies have an interest in the Indian market.
Former Indian Ambassador to South Korea, Vishnu Prakash, too feels that elevating the economic partnership is mutually beneficial for both countries as South Korean companies were keen to explore the Indian market despite the fact that the current trade volume of $20 billion is very small compared to Korea's trade with China which is a whopping $250 billion.
"Underpinning of our relationship is economic and given the fact that Korean companies are getting a little wary of China as their exposure is huge, and Beijing has been turning the faucet on and off. Giving them grief on the Thaad missile issue because of which 2017-18 were very difficult for South Korea,” Prakash told CNBC-TV18.
"Beijing turned the screws on the Lotte Group, which had to almost shut shop in China. Chinese tourists to Korea, which were in millions dried up. China uses its economic might to strangulate Korea and the Koreans want to diversify," the former envoy said.
Prakash highlighted that South Korea's exposure to India is growing steadily and in the last two years, the Samsung plant in Uttar Pradesh and Kia Motor's investment in Andhra Pradesh are the two major investments adding up to $2 billion.
Talking about the agenda for the visit, Bongkil said, “I think the economic agenda is the most important. The two leaders would be discussing cooperation in the defence industry, infrastructure, joint venture in high-end steel manufacturing, space programs and people to people exchanges."
Bongkil said, "The timing of the visit says everything and the fact that Prime Minister Modi is visiting Seoul in a really hectic election season means he has an urgent agenda to talk to my President and elevate ties."
India is also keen to explore joint production in the defence sector. Secretary east in the ministry of external affairs, Vijay Thakur Singh said, "We are looking at defence technologies and co-production and just to let you know that one of the joint defence co-production is a joint venture between Larsen & Toubro and Korean company and they are producing 100 artillery guns.”
Ambassador Bongkil said South Korea was keen to upgrade the Comprehensive Economic Partnership Agreement (CEPA) with India by the end of the year. There would also be discussions on upgrading CEPA during the visit. South Korea would like to elevate its CEPA agreement with India to the level of its agreement with Japan.
Prime Minister Modi would spend close to 30 hours in South Korea and participate in at least 15 meetings, including a bilateral with President Moon Jae-in. On February 21, he would address the India Korea Business Symposium and unveil a bust of Mahatma Gandhi at varsity in Seoul.
During the visit, Prime Minister Modi will also be conferred with the 2018 Seoul Peace Prize at a ceremony to be organised by the Seoul Peace Prize Cultural Foundation on February 22, in recognition of his national and international contributions.President Moon Jae-in would be the third global leader that Modi would be meeting after the Pulwama attacks. Sources tell CNBC-TV18 that Prime Minister Modi may brief the South Korean President about cross border terrorism emanating from Pakistan and Indian diplomats may push for a strong declaration against terrorism during negotiations.