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India and South Korea are taking time out to further strengthen an already robust relationship, a priority underscored by Narendra Modi hosting South Korean president Lee Jae-myung last week to boost trade and technology ties. South Korean chaebols were pioneer investors in India's liberalising economy and have done extremely well. The Indian middle class loves Korean cars and consumer goods that competitors from Europe and America can only envy. Exports of these goods from Indian factories have also performed strongly, long before India began positioning itself as a global manufacturing destination. Indian investors, too, show a strong appetite for listings of local units of Korean conglomerates. Teenagers, meanwhile, can't seem to get enough of K-pop.
Where can the two countries go from here? Bigger would be better. South Korea may have charmed with its economic engagement, but India would welcome more of it. From chips to ships, Seoul has much to offer in strategic and advanced manufacturing. South Korean investment in India still trails that of Japan by a wide margin. Two-way trade could be doubled with relative ease, although India would prefer a more balanced trajectory than the current surplus enjoyed by South Korea.
China remains South Korea's leading overseas investment destination, despite recent US efforts to redirect some hi-tech manufacturing. Vietnam has emerged as the preferred hub for Korean conglomerates pursuing a China-plus-one strategy. India, therefore, must extend a more targeted welcome and channel engagement into specific sectors. Shipbuilding, for instance, should interest South Korea, given that most of its energy flows pass through the Indian Ocean and its imports from India are dominated by naphtha and refined petroleum. The challenge for New Delhi is to attract more sustained South Korean attention while avoiding a deeper Chinese economic pull. Simply wooing Seoul will yield only incremental gains in the India-South Korea partnership.
Where can the two countries go from here? Bigger would be better. South Korea may have charmed with its economic engagement, but India would welcome more of it. From chips to ships, Seoul has much to offer in strategic and advanced manufacturing. South Korean investment in India still trails that of Japan by a wide margin. Two-way trade could be doubled with relative ease, although India would prefer a more balanced trajectory than the current surplus enjoyed by South Korea.
China remains South Korea's leading overseas investment destination, despite recent US efforts to redirect some hi-tech manufacturing. Vietnam has emerged as the preferred hub for Korean conglomerates pursuing a China-plus-one strategy. India, therefore, must extend a more targeted welcome and channel engagement into specific sectors. Shipbuilding, for instance, should interest South Korea, given that most of its energy flows pass through the Indian Ocean and its imports from India are dominated by naphtha and refined petroleum. The challenge for New Delhi is to attract more sustained South Korean attention while avoiding a deeper Chinese economic pull. Simply wooing Seoul will yield only incremental gains in the India-South Korea partnership.
