India South Korea Free Trade Agreement

The growth rate of exports from India and the composition of export markets were some factors that led to an increase in the trade deficit. India should look at ways to reduce this deficit by focusing on specific sectors. Figure 6 shows the increase in the trade deficit after 2010. The mirror data used comes from UN Comtrade. As the graph shows, the trade deficit increased after the signing of the EPA to $10.5 billion in 2018. Slower and more sustainable integration into a trade agreement such as the RCEP would have corresponded to India. Now that India is not part of the RCEP, the country must begin the long reforms of the national sector. This should be done meticulously and in mission mode. In January 2005, the two sides formed a joint task force to assess the feasibility of a free trade agreement between the two countries.

Over the next four years, the Joint Study Group reviewed existing trade between the two countries worth $7.1 billion and negotiated an agreement that respected the weaknesses and economic strengths of the two countries` markets. Rahul Khullar, India`s trade minister and member of the Joint Study Group, says such cooperation took place during discussions on the agricultural sector, which is particularly weak in South Korea but thrives in India. [10] This measure is gaining importance as India is reviewing the bilateral trade pact with South Korea to protect the interests of local traders and industry. «A meeting is scheduled for Friday. The trade deficit is currently favourable to South Korea, which is why the Comprehensive Economic Partnership Agreement (CEPA) is being revised. The Ministry of Commerce is holding a meeting with exporters to find out why our exports are not growing,» said one industry official. Clothing and apparel, un knitted or crunched (product code SH 62), are among the top 12 Indian exports to Japan. While tariffs on this product have been reduced in the EPA, the absolute commercial value has fallen (see Figure 4).

In addition, the average annual growth rate was 2%. This may be due to competition from other countries, as Japan`s other trading partners, such as Bangladesh and Vietnam, also enjoy similar benefits; these countries outperform India in terms of the share of textile exports. To remain competitive in the textile sector, India must therefore innovate in terms of product lines and cost-cutting measures.