South Korea OK's India Free Trade Agreement

South Korea OK's India Free Trade Deal As Asia Powerhouse Economies Expand Foreign Markets

(AP)  SEOUL, South Korea (AP) - South Korea on Friday approved a free trade deal with India that promises to give two of Asia's powerhouse economies vastly expanded access to each other's markets.

The National Assembly approved the deal with a 192-0 vote. Five lawmakers abstained.

The two countries signed the accord, known officially as the Comprehensive Economic Partnership Agreement, in August.

Trade between India and South Korea - Asia's third- and fourth-largest economies, respectively - has grown steadily in the past decade and reached $15.6 billion last year. In 2002, it amounted to just $2.6 billion.

Under the agreement, tariffs on Indian goods will be abolished or slashed by 90 percent, while those on South Korean products will be gradually cut by 85 percent over 10 years, according to South Korea.

India has already completed all procedures for the agreement to take effect, said Rajasekhar Chinthapally, minister for economic affairs at the Indian Embassy in Seoul. He said international treaties do not require parliamentary approval in India and can be decided by the Cabinet.

South Korea and India will now work to see that the agreement takes effect in January, officials said.

South Korea has been aggressively pursuing free trade agreements as part of a strategy to boost its economy and increase opportunities for its companies, including heavyweight exporters such as electronics maker Samsung and automaker Hyundai.

It has negotiated deals with the United States and the European Union, although both remain unratified.

In effect are agreements with 15 countries: Chile, the 10-member Association of Southeast Asian Nations, and the European Free Trade Association, which comprises Switzerland, Iceland, Liechtenstein and Norway.

South Korea is negotiating free trade deals with 11 nations, including Canada, Mexico, Australia, Peru and New Zealand.

___

APTN Producer Hyun-ah Kim and Associated Press Writer Kwang-tae Kim contributed to this report.