Thursday 9 January 2014

India, Korea agree to expeditiously revise DTAA provisions; Indian Customs may notify Korean counterpart for speedy clearance of Indian goods

AT the 4th India-Korea Finance Ministerial Meeting here today, the Indian Finance Minister, Mr P Chidambaram, said that India and Korea share a common vision towards building an equitable and just politico-economic international order. Mr Chidamabaram said that relations between India and Korea are based on strong historical ties, shared cultural heritage, commitment to democracy and a mutual desire to establish and strengthen long-term comprehensive strategic partnership.
At the meeting, both sides agreed to make an effort to conclude the revision of the Korea-India
Double Taxation Avoidance Convention (DTAC) expeditiously after reviewing their respective positions on major pending issues for the revision. Both sides also agreed to consider issue of license necessary to establish Bank Branches and offices in each other’s country if an applicant bank is judged to have qualified based on relevant laws, regulations and eligibility requirements. Both sides shared recognition of the necessity for cooperation in financial supervision and agreed to discuss and conclude an MOU on financial supervision between The Reserve Bank of India and the Financial Services Commission, Korea.

Both sides agreed to strengthen cooperation in the infrastructure sector between the two countries by the signing of an MOU between the Export-Import Bank of Korea and India Infrastructure Financing Company Ltd in January 2014 for the purpose of mutual exchange of information on infrastructure development projects.

Both sides agreed to strengthen cooperation in bilateral trade by means of the Master Interbank Export Credit Agreement worth USD 200 million between the Export-Import Bank of Korea and State Bank of India to be signed in January 2014, which will facilitate the provision of export credit to India.


Both sides underscored the need to evolve a vision for medium and long-term cooperation between the two countries for systematic and close bilateral cooperation, and agreed that identified research institutes of the two countries would jointly discuss this subject.

The India-Korea Comprehensive Economic Partnership Agreement (CEPA) has contributed to enhancing trade and investment flows between the two countries. It has brought the two economies closer. Both sides agreed to continue their consultations on the CEPA. In order to enhance trade relations, both sides further agreed that, in case either Customs Authority notifies its counterpart of difficulties encountered in the process of Customs clearance, the two Authorities will make efforts to address the difficulties expeditiously.

Both sides agreed to make efforts to promote SME cooperation between the two countries by sharing knowledge and experience gained on SME policies and by creating strategic industrial partnerships for investment and technical cooperation.


The Indian side agreed to the proposal from the Korean side for the two sides to sign the MOU on railway cooperation and for holding a senior officer level railway cooperation meeting between the two countries.

The Indian side agreed to the proposal by the Korean side for the two sides to sign the Framework of Cooperation (FOC) on roads and to hold a Joint Committee Meeting on road cooperation between the two countries after the FOC has been signed.

The Indian side requested the Korean side to encourage investment by Korean long-term infrastructure related funds in the various infrastructure investment instruments that have been and are being launched in India. The Korean side agreed to consider the same positively.

The Korean side requested for facilitation from the Government of India for speedy administrative support including issue of clearances and licenses required in the various projects that Korean companies are participating in and committed to at the State level. The Indian side agreed to provide all possible assistance within the federal structure in India.

Both sides agreed to hold the next round of air consultations in a mutually beneficial way recognizing the importance of air services in promoting, economic, social and cultural exchanges and people-to-people interactions.

The Korean side proposed to conclude an MOU including establishing cooperation channel, a joint committee at the Director General level, for enhanced cooperation and exchanges in the field of electric power and the Indian side agreed to consider the proposal including holding a joint committee meeting on cooperation in electric power at a mutually agreed time.

Recognizing that a Science and Technology Cooperation fund of USD 10 million has served to implement joint research projects, both sides agreed to step up cooperation by creating an additional joint fund of USD 10 million (with a contribution of USD 5 million by each side) to promote applied research and development programmes which will be conducted jointly by academia, research institutes and businesses of both countries.

Both sides recognized that the Korea-India Finance Ministers’ Meeting can contribute practically to reinforcing economic cooperation between the two countries and reaffirmed their commitment to making efforts to strengthen basis for mutual cooperation in the future. Both sides agreed to hold the Fifth Korea-India Finance Ministers’ Meeting in Korea this year.

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