India, South Korea working to double bilateral trade by 2030: Piyush Goyal
India and South Korea have announced a shared goal of doubling bilateral trade from approximately USD 27 billion to over USD 50 billion by 2030. Both sides h...
What Happened
- India and South Korea have announced a shared goal of doubling bilateral trade from approximately USD 27 billion to over USD 50 billion by 2030.
- Both sides have agreed to upgrade their existing Comprehensive Economic Partnership Agreement (CEPA), which has been in force since 2010, to address non-tariff barriers, ease rules of origin, and expand market access.
- The two countries signed 15 agreements spanning sectors including artificial intelligence, semiconductors, steel, shipbuilding, and digital infrastructure during a high-level bilateral engagement in April 2026.
- A new "Digital Bridge" initiative was launched to deepen collaboration in AI and semiconductor research and development.
- South Korea's President Lee Jae-myung's visit to India elevated the bilateral relationship and placed technology and defence cooperation alongside trade as priority pillars.
Static Topic Bridges
Comprehensive Economic Partnership Agreement (CEPA)
A CEPA is a trade pact broader than a standard Free Trade Agreement (FTA). It covers goods, services, investment, intellectual property, and movement of professionals. India and South Korea signed their CEPA on August 7, 2009, after twelve rounds of negotiations over more than three years; it entered into force on January 1, 2010.
- Commits both sides to reduce or eliminate import tariffs on a wide range of goods over time.
- Allows temporary movement of Indian IT professionals, software engineers, and English language teachers to South Korea — with 163 professions permitted market access.
- By 2011, bilateral trade had risen to USD 20.6 billion, a nearly 70% increase within two years of CEPA coming into effect.
- Critics note that India has run a persistent trade deficit with South Korea, prompting calls for CEPA review.
Connection to this news: The current CEPA upgrade talks aim to rebalance the agreement by addressing non-tariff barriers and creating a more equitable trade framework consistent with the USD 50 billion target.
India's Act East Policy
India's Act East Policy — the successor to the earlier Look East Policy — formalises deeper strategic, economic, and people-to-people engagement with the Indo-Pacific region, including East and Southeast Asia. South Korea was designated as a "Special Strategic Partner" of India in 2015, reflecting the elevated nature of this bilateral relationship.
- The partnership covers defence co-production, critical minerals, shipbuilding, and emerging technology.
- South Korean firms such as Samsung Electronics and SK Hynix have shown interest in India's semiconductor value chain, particularly R&D and software-layer activities.
- India sees South Korean investment as complementary to its own semiconductor mission under the India Semiconductor Mission launched in 2021.
Connection to this news: The CEPA upgrade and the new Digital Bridge initiative directly serve Act East goals — deepening India's presence in technology-intensive global value chains through strategic partnerships with advanced economies in the Indo-Pacific.
Trade Deficit and Review of FTAs
India has reviewed several of its bilateral trade agreements in recent years, noting that agreements with ASEAN, South Korea, and Japan have contributed to widening trade deficits due to import surges in goods and limited gains in services exports.
- India's goods trade deficit with South Korea has persisted at several billion dollars annually.
- The review process focuses on non-tariff barriers faced by Indian exporters (especially in pharmaceuticals, chemicals, and textiles) in the South Korean market.
- Rules-of-origin provisions are a key renegotiation point — India wants to prevent third-country goods (especially Chinese) from being routed through South Korea using CEPA benefits.
Connection to this news: The CEPA upgrade currently being negotiated is partly India's response to these structural imbalances; the target of doubling trade must be accompanied by making trade more balanced.
Key Facts & Data
- Current India-South Korea bilateral trade: approximately USD 27 billion (2025–26).
- Target: USD 50 billion by 2030 — requiring sustained growth of approximately 13% per year.
- India-South Korea CEPA signed: August 7, 2009; in force: January 1, 2010.
- India-South Korea Special Strategic Partnership established: 2015.
- 15 agreements signed during the April 2026 visit covering AI, semiconductors, steel, shipbuilding, and ports.
- South Korean conglomerates (Samsung, Hyundai, LG, POSCO) have a significant existing investment footprint in India.
- Key sectors targeted for new cooperation: AI, semiconductors, digital infrastructure, defence, shipbuilding, critical minerals, EVs, and green hydrogen.