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India and Korea have decided to expand their trade. This decision will help cut down the $12 billion trade deficit that India has with South Korea.
Now India will be able to export larger quantities of shrimp, beer, and processed food to South Korea with lower tariffs. The yoga instructors of the country can set up schools in the East Asian country and the Taekwondo teachers from South Korea can come to provide training here. India has also got extended visas for intra-corporate transferees. Indians working in Korean companies will now be getting three-year work permit instead of one as per earlier regulations. The revised India-Korea free trade agreement called the Comprehensive Economic Partnership Agreement (CEPA) brings many benefits for exporters.
India can now sell 15,000 tonnes of shrimp at zero duty. Shrimp and beer were given concessions. Korea will import Indian popcorn at 630% duty but the duty on Indian beer will be nil for next ten years. The beer from India was charged a 30% tax till now. India made processed food items such as jams, marmalade, and jellies were charged 30% tax in Korea and will be sold on zero duty for the next ten years.
CEPA was revised and signed on Tuesday in the presence of South Korean President Moon Jae-in. The two countries have agreed to take the bilateral trade to $50 billion by the year 2030. Korea asked for cutting down tariffs of 17 items that include some products such as automobiles and certain grades of steel that India did not agree to as it can hurt the domestic industry. Under an early harvest, the two countries decided to cut down levies on 11 items.
India will cut down 50% duty on Korean base oil imports to 2.5% in fifteen years and zero the tax on eau de cologne in ten years. India buys $1 billion of base oil. The flavored instant coffee and synthetic rubber called EPDM from Korea will be sent to India at reduced tariffs. Fish preparations are charged 5% tax which will be eliminated in eight years.
Other items that will also catch lower duties are Indian mangoes, maize corn, castor oil, bakery items and other marine products were confirmed by an official.