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Krishna’s visit to Republic of Korea: Reaping the Dividends

Rajaram Panda was Senior Fellow at the Institute for Defence Studies and Analyses, New Delhi. Click here for profile
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  • June 25, 2010

    The successful visit of External Affairs Minister S. M. Krishna to the Republic of Korea on 17-19 June 2010 has once again highlighted the deepening of India’s strategic engagement with the ROK. The series of high level bilateral visits between India and the ROK on a continuing basis show that not only India’s global diplomatic profile is increasing commensurate with its consistent economic growth for over a decade but also indicates that other countries look at India for a leadership role on critical global issues. The sculpting of a strategic partnership and inking of a Comprehensive Economic Partnership Agreement (CEPA) show that ROK is keen to engage India on matters where their mutual interests converge.

    India-ROK bilateral relations have expanded in almost all spheres: political, economic, cultural and strategic/defence. In the political component of the relationship, engagement of political leadership at a high level has provided the framework for relations in other areas to blossom. In the economic domain, things are already looking up. Agreements have been reached to unearth the cultural depth and strengthen them further by providing institutional support. Defence cooperation is another area where both see mutually beneficial opportunities.

    First, Political: Since India adopted its “Look East” policy in the early 1990s, the ROK has responded enthusiastically to construct a fruitful relationship. This was based on the historical foundation that was already in place.1 An example of ROK’s warmth towards India came after India’s 1998 nuclear tests. The ROK was aware that its arch enemy - North Korea – was receiving nuclear technology from Pakistan and Seoul was appreciative of India’s security needs as also the security environment in the South Asian region. The evolution of this relationship reached a high point when President of India made a state visit to the ROK in February 2006 and paved the way for bilateral ties to enter a period of vibrancy. Following President Lee Myung-bak’s visit to India in January 2010 as Chief Guest at the Republic Day celebrations, bilateral ties were elevated to “Strategic Partnership”.

    Second, economic: During the Indian President’s visit in February 2006, the Joint Task Force for concluding a bilateral CEPA was launched. Subsequently, when Minister for Commerce and Industry Anand Sharma visited ROK on 7 August 2009, the CEPA was signed. It came into force on 1 January 2010. The impact of the CEPA was immediately felt with bilateral trade soaring by a robust 70 per cent in the January-April 2010 period. Projections of an upward trend in the coming months may lead to bilateral trade reaching the target of $30 billion by 2014.2 While South Korea’s economic presence in the Indian market is already visible, some sectors of Indian industry such as pharmaceuticals, IT enabled services and agro-products are looking for greater market access in the ROK.

    On 1 June 2005, both countries agreed to take their bilateral ties to a higher plane “by utilizing synergies in trade, investment and hi-tech areas”. South Korean company POSCO agreed to set up a $12 billion integrated steel plant at Paradip in Orissa. This mega project is the single largest foreign investment by any country in India. The Central government has already given all the necessary clearances. Though there has been some opposition from the local people in the state in connection with land acquisition, the state government is working hard to move the project forward. The delay has not led POSCO to retract its commitment from the project.

    ROK is one of the top ten investing countries in India.3 LG, Samsung and Hyundai have already become household names in India. The main sectors attracting FDI from the ROK are transportation industry, fuel (power and oil refinery), electrical equipment (computer software and electronics), chemicals (other than fertilizer) and commercial, office and household equipments. Conversely, Indian firms such as Tata Motors have entered the South Korean market by acquiring Daewoo Commercial Vehicles, Kunsan at a cost of $102 million.

    Third, cultural: The historical cultural links are being brought back to the surface to complement the burgeoning economic and defence ties. During the meeting of the Sixth Joint Commission on 18 June 2010,4 Krishna signed three documents: (a) MoU between the Ministry of Micro, Small and Medium Enterprises of India and the Small and Medium Business Administration of the ROK on Cooperation in the field of Small and Medium Enterprises; (b) MoU between the Indian Council of Cultural Relations and Korea Foundation;5 and (c) MoU for cooperation between the Indian Council for World Affairs (ICWA) and the Institute for Foreign Affairs and National Security (IFANS) of the ROK.

    The year 2011 has been designated as the “Year of India” in Korea and “the “Year of Korea” in India, showcasing their cultures in each other’s country. Rabindranath Tagore acquired a huge reputation in the ROK after he composed a short but evocative poem in 1929 about Korea’s glorious and bright future. Tagore wrote:

    In the golden age of Asia
    Korea was one of its lamp bearers,
    And that lamp is waiting
    To be lighted once again
    For the illumination of the East.

    At present The Indian diaspora in the ROK is estimated to be about 6000. The composition of the Indian community includes businessmen, IT professionals, scientists, researchers and students. The 1,000-strong IT professionals and hundred-odd scientists can provide intellectual inputs to exploit the potentials of the relationship. While interacting with prominent members of the Indian community, Krishna observed that bilateral ties were at the “cusp of a major take-off” and exhorted them to assist the process.

    Fourth, strategic/defence: This component of the relationship is the most important and Krishna took care to stress on this aspect. While addressing a large gathering of scholars, researchers and diplomats at IFANS, Krishna suggested a six-pronged strategy for strengthening India-ROK strategic partnership in the 21st century. Besides agreeing on an open and inclusive Asian regional architecture based on the principles of mutual benefit and shared opportunity, both countries have agreed to work towards this goal within the East Asian Summit framework.

    Coping with the challenges emanating from non-state actors in the Gulf of Aden was identified as the core focus for cooperation in defence and in particular between the two countries’ navies. India’s Defence Minister A.K. Antony is scheduled to visit the ROK later this year to finalise naval security cooperation. When the Prime Minister visits the ROK in November 2010 for the G-20 summit, bilateral relations will get a further boost.6 Another dimension of bilateral cooperation was identified in the energy sector. The ROK welcomed Krishna’s suggestion to establish an India-ROK Joint Working Group on Hydrocarbons to draw benefits from each others’ expertise.

    The biggest news came when while addressing the IFANS, Krishna said that both countries “will soon commence negotiations on an agreement for peaceful uses of nuclear energy”. He further said that such an accord was relevant for India’s “search for a more rational energy mix”. Recognising “Korean capabilities in civil nuclear energy”, a framework for cooperation will help address India’s growing energy needs. India and ROK have already exchanged drafts for inking an Inter-Governmental Agreement on Peaceful Uses of Nuclear Energy and an early conclusion of such an agreement would be of tremendous interest for India as such a deal will pave the way for Seoul’s export of atomic power plants to India. Since the ROK generates 40 per cent of its electricity from nuclear power plants and is eager to export its expertise, India can benefit if both countries reach an agreement on this subject.

    Launching of Korean satellites on Indian launch vehicles can be a tempting proposition for the ROK. On the possibilities in space-related cooperation, Krishna said: “In 1999, a Korean satellite KITSAT III was launched by India. We look forward to working with the RoK (Republic of Korea) in fabrication of satellites as also in helping you launch more Korean satellites on Indian launch vehicles. Our launch services are of very high quality and our costs are extremely competitive. Perhaps, the RoK can think in terms of participating in experiments on our next Moon orbiter, Chandrayaan II. The sky, literally, is the only limit to such scientific collaboration between India and Korea.”

    A marriage between ROK’s strengths in reactor technology and India’s strength in space programme can lift India-ROK ties further.

    • 1. Anti-colonial movements in both countries, India’s role as Chairman of the nine-member UN Commission set up to hold elections in Korea in 1947, India’s role in the Korean War (particularly of Colonel Rangaraj) in aiding wounded soldiers and in rendering medical aid, etc. are all well appreciated in Korea even today.
    • 2. Given an annual increase of about $3.3 billion, this seems to be an achievable target.
    • 3. Currently, it is the 4th largest investor in India in terms of actual FDI flow.
    • 4. India-ROK Joint Commission for bilateral cooperation was established in February 1996 and is chaired by the External Affairs Minister of India and the Minister for Foreign Affairs and Trade from the Korean side. The sixth JCM meeting was held during Krishna’s visit.
    • 5. Korea Foundation is looking for office space in New Delhi and is likely to begin functioning from 2011.
    • 6.