India next destination for South Korean companies: KOTRA
Owing to growing political tension between South Korea and China, and US-China trade war, a score of Korean companies are uprooting their factories from China and are shifting to India. About 100 Korean companies invested in India in 2019-20.
NEW DELHI: If the words by the Korea-Trade Investment Promotion Agency (KOTRA) chief in India are to be marked carefully, there is good news in store for India, and also for its business community.
Owing to the growing political tension between South Korea and China, and the US-China trade war, a significant score of Korean companies are uprooting their factories from China and are shifting to India.
As many as 100 small and medium scale Korean companies shifted their base to India during the current year 2019-20, and the majority of these were from China.
According to an industry estimate, there are about 50,000 Korean companies/factories operating on Chinese soil at present. And the number of Korean companies in India is under 700.
“Korean companies’ opinion about China is not so positive now, and they want to shift from China to India because of some trade issues between China and the USA, and also political relations of Korea with china also are not good. US-China trade war is also one of the reasons. There is a tension between South Korea and China on trade and investment issues,” Young Kim Moon, President, KOTRA, South-West Asia told Asian Community News (ACN) Network.
According to Moon, many Korean companies are thinking their next market will be in India.
“Many small and medium Korean companies are shifting their factories from China to India, and this is under process. For them, India is the next destination instead of china. Almost 100 new Korean companies are coming and investing in India every year as it happened in the year 2019-20,” said the KOTRA chief.
He said more and more Korean companies wanted to enhance export and import with India, and many small and medium sector factories were shifting to Noida, Chennai, Andhra Pradesh, and Karnataka.
It means there will be more investment from Korea to India as well as more export s and imports between the two nations in time to come, he added.
While comparing the existing Korean trade volumes with China and India, Moon said Korea’s export to China is 25% of its total export, which is a very big volume.
“Korea is exporting goods to the tune of USD 150 billion to China, which is again one-fourth of Korea’s bilateral trade with China. But comparatively, it is very small in India. It’s around USD 21 billion so far. Even though the target of taking it to USD 50 billion is a big jump but I hope we can reach it in the next ten years,” said Moon.
At present, there are about 700 Korean companies in India as compared to Japan that has about 1500 companies operating here.
On this, the KOTRA Chief said that Korean companies started coming to India in the early 1990s when the country opened its economy to the world and took to liberalization.
India was not so popular before that, he added.
