India – South Korea Relations | UPSC Mains: International Relations PDF Download

Why in News?

Recently, in order to provide logistical support to each other's navies, India and South Korea have signed a military logistics agreement and have formulated a road map for joint production and research for military system during the recent visit of Defence Minister Rajnath Singh to South Korea.

Introduction

• India and Korea have had long historical relations spanning many centuries; yet their partnership in recent years contains immense untapped potential, something both countries are actively looking to alter. Especially over the last couple of decades, the importance of rebuilding, strengthening, and deepening bilateral ties between the two countries have been increasingly recognised.
• In recent years, relations between India and South Korea have made great progress and become multidimensional, stimulated by a substantial convergence of strategic interests and high-level government exchanges. The India-South Korea axis can be very valuable at a time when the world is passing through a phase of uncertainty; this vital bilateral partnership can significantly contribute to peace, security, and stability in the Indo-Pacific region, especially through strengthened economic partnership and deepen security relations. South Korea’s open market policies finds a clear resonance with India’s economic liberalization. The 'Act East Policy' of India certainly complements the 'New Southern Policy' of South Korea and adds new substance and impetus to bilateral cooperation between two nations in all areas of engagement. A lot of complementarities exist at various levels between two countries; for example, South Korea’s technological advancement and manufacturing capabilities can be helpful in India’s economic growth and human resource development. Seoul’s successful development story of the last few decades can complement Indian Prime Minister Modi’s vision of making a “New nI dia” by 2022.

Complementarity between 'Act East Policy' and 'New Southern Policy'

• To reduce export dependence on China and United States and establish alternative trade structures in the region, South Korean President Moon Jae-in has unveiled the 'New Southern Policy' to deepen relations with ASEAN and India. The 'New Southern Policy' emphasises the “3P” community: People, Prosperity, and Peace. With a 'people first' mindset, the government hopes to increase trade with this region to establish symbiotic prosperity. Additionally, given the abnormal atmosphere on the Korean peninsula, the Republic of Korea hopes to build an alliance of nations to help promote communication in the region, keeping in mind the goal of attaining denuclearisation on the peninsula and greater peace for the East Asian region as a whole.
• Similarly, since 2014, India has been seeking deeper involvement with its Eastern neighbours to reduce dependence on its Western counterparts, namely through the 'Act East Policy.' The focus of this policy can be simplified into the “3C’s,” Culture, Connectivity, and Commerce. India’s close geographic proximity and cultural similarities with many of these nations give it a huge advantage in conducting trade with them.

The importance of Indo-Korean relations has been amply underscored in recent years especially under both current governments. President Moon’s visit o Intdia n ui lyJ 2018 was a landmark in their diplomatic relations and PM Modi’s second official visit to Seoul in February 2019 and recent visit of Union Defence Minister, further cemented their relations.

Defence Relations

India and South Korea have deepened their bilateral relations in the defense sector through more military exercises and training as part of efforts to enlarge their partnership beyond economic engagement. The two countries hold a joint anti-piracy, search and rescue exercise, Sahyog-Hyeoblyeog, which is conducted between the Indian Coast Guard (ICG) and Korean Coast Guard (KCG) to improve maritime security and interoperability in the Indian Ocean Region. Besides holding more joint exercises, New Delhi is also looking to attract South Korean defense companies to invest in India. India is developing strong military hardware cooperation with South Korea as the Indian Army has already inducted the K-9 Vajra self-propelled howitzers (which has roots in South Korea's K-9 Thunder) built in partnership with the Indian firm Larsen and Toubro.

Recent Developments

• India and South Korea concluded a military logistics agreement during the recent visit of Defence Minister Rajnath Singh to Seoul. The two countries also formulated a forwardlooking road map to take bilateral defence industry cooperation to the next level. The decision to extend logistical support to each other’s navies will significantly enhance Indian reach in the Indo-Pacific and will place South Korea amongst close partners like the US and France that have similar bilateral pacts. The roadmap has listed a number of proposed areas of cooperation in sectors of land systems, aero systems, naval systems, research and development co-operation and collaboration in testing, certification and quality assurance.
• India offered tremendous business opportunity to Korean defence industries. India has set an ambitious target for itself when it comes to defence exports, with the belief that external markets have to be tapped to nurse a commercially viable military industrial complex. The government plan is to give the defence sector a $ 25 billion pie in the $ 1 trillion Indian manufacturing economy that it targets for 2025. Out of this, defence exports by Indian companies are targeted at $ 5 billion.

Other Relations

• Since India opened up its economy in the early 1990s, India-South Korea trade ties have grown from few hundred million dollars to $22 billion at the end of 2018. Today the major items that India exports to South Korea include mineral fuels, oil distillates (mainly naphtha), cereals and iron and steel. South Korea’s main exports to India include automobile parts and telecommunication equipment, among others.
• However, despite the robust ties, not everything is going as planned. The trade target of $50 billion by 2030 is most likely to be missed due to lack of adequate efforts. The Comprehensive Economic Partnership Agreement, originally the core mechanism for economic ties, requires immediate upgrading. An early harvest offer agreed last year, under which India agreed to reduce tariff on 11 commodities and South Korea on 17, failed to see completion.

India's Importance for Korea

• Like India’s 'Act East policy', South Korea has its ‘New Southern Policy’ that focuses on strengthening its economic and strategic relations with South-east Asia, Australia and India.
• South Korean economy is heavily export dependent and its top two trade partners are China and the US. As the trade war between the two affects Chinese economy, major South Korean exporters (like Samsung and Hyundai) have seen their profits decline.
• By strengthening ties with India and other Association of Southeast Asian Nations (ASEAN) countries, South Korea is planning to reduce its over-dependence on its two traditional trade allies.
• To keep the export engine that drives its economy running, South Korea is now targeting economies with the greatest growth potential and India (and its huge consumer market) is projected to grow at more than twice of South Korea in the coming years. That its companies already have a significant presence adds to the comfort. The country’s ageing population means India could be a source of talent too.
• South Korea’s reliance on China’s market also arms Beijing with considerable leverage over Seoul, which it has sometimes used to further its political interests. China’s imposition of economic sanctions on South Korea last year in response to the US deployment of its antimissile system forced Seoul to rethink its China strategy. Indirectly endorsing the idea of Indo-Pacific nations and aligning with India and ASEAN countries will also help reduce its China-related risks.

Korea’s ‘China’ Dilemma

• China emerged as South Korea’s biggest economic partner as their relations normalised after the end of the Cold War. South Korea’s trade and investment relations with China have increased manifold due to its economic liberalisation and the rise of China’s economy. At the same time, its relations with the US and Japan have declined because of the rise of American protectionism and the stagnation of the Japanese economy. Indeed, the equations have changed over the past two-and-half decades. China has now emerged as South Korea’s top export destination. It made up 26.6 percent of South Korea’s total exports in the first half of 2018, higher than the 16.5 percent accounted for by the US and Japan combined.
• Such economic dependence was not a security concern for Seoul’s policymakers until China began its path of “peaceful rise”. The change began in the late 2000s with the controversy over the Goguryeo Dynasty, Cheonan and Yeonpyeong incidents in which many South Koreans were killed by North Korea and a few years later China’s declaration of a new Air Defence Identification Zone (ADIZ) in 2013 which partly overlapped South Korea and Japan. Political observers in Korea recognise that China’s economic policy towards South Korea is driven by political interests as the former wants to use its economic relations to deal with the region’s political issues.
• Further, the negative perception about China worsened when it targeted South Korea’s business interests over the deployment of the US missile system THAAD (Terminal High Altitude Area Defence) in its territory. South Korean businesses in China were attacked and exports to China were curtailed. This made Seoul realise the need to diversify its trade destinations and look towards other partnes such as India and the ASEAN countries. So, there is a growing perception in South Korea that China’s rise as an economic power is a ‘threat’ to it, rather than an opportunity.

Pivot to India

• South Korea’s choice for India is best explained in the words of Trade Minister Kim hyun-chong who said, “India is a country that has no sensitive issues with us geopolitically, so has little risk of its economic cooperation wavering due to external factors. China, for example, created serious problems for our country over the THAAD issue, but with India there are no such variables."
• The South Korean companies in India, such as Samsung, LG Electronics and Hyundai Motor, are undertaking expansion activities. Several new South Korean companies are also entering India. For instance, Kia Motors has signed anMoU to invest about US$ 1.1 billion, which was later enhanced to US$ 2 billion, to build its first factory in Andhra Pradesh. Seoul is also pushing its small and middlescale companies to enter India in view of tough challenges they are facing in China. Seoul has recently shown its willingness to partner with India’s flagship initiatives such as ‘Make in India’, ‘Skill India’, ‘Digital India’, ‘Startup India’ and ‘Smart Cities Mission’. In addition, the Moon administration has decided to establish the Korea- India Future Strategy Group and the India-Korea Centre for Research and Innovation Cooperation (IKCRI). The latter is expected to provide an institutional framework for cooperation based on research, innovation and entrepreneurship.
• For its part, the government of India is taking measures to enhance South Korean investment. It has created, for example, a ‘Korea Plus’ mechanism under the Department of Industrial Policy & Promotion (DIPP) to boost the presence of South Korean companies in India. Various events and campaigns have been organised to create awareness amongst the Korean firms. India is receiving numerous business proposals, that it now plans to upgrade the ‘Korea Plus’ initiative into a ‘Korea Square’ mechanism.

Deepening Ties

• The new approach of South Korea also puts an emphasis on enhancing its strategic relationship with India. India also looks at South Korea as an indispensable partner in its Act East Policy (AEP). The two countries are now working towards a new diplomatic mechanism in the 2+2 format. Once it is operationalised, South Korea would become the third country to hold such a dialogue with India, after Japan and the US.
• In addition, South Korea has demonstrated its desire to cooperate with India to secure the sea lines of communication (SLOCs) in the Indian Ocean. The navies of the two countries have held a joint drill in the Indian Ocean in 2017 and followed by a joint exercise between the coast guards of the two countries in 2018.
• Although Seoul has not openly endorsed the emerging ‘Indo-Pacific’ concept due to its apprehension that China might retaliate through economic measures, it believes that it will gain from a US-led security system in Asia and an India-centric Indo-Pacific region. South Korea is exploring ways to become a part of the Indo-Pacific construct. There have been a number of conferences and seminars in which South Korea’s leading scholars and diplomats have discussed the country’s role in the Indo-Pacific era. India’s role in the region and its relations with South Korea are also highlighted in these gatherings, both official and non-official. Seoul also recently agreed to explore a tripartite partnership with New Delhi for the development of capacity building programmes in Afghanistan.
• Seoul is also seeking to strengthen relationships in the strategic sectors, including the defence and civil nuclear industries. Both the countries are now working towards implementing the India-Korea civil nuclear deal signed during the Manmohan Singh regime.
• All these changes in the bilateral engagements have undoubtedly brought about a noticeable shift in India’s approach to the Korean peace process. From a policy of strategic isolation, India has moved to strategic engagement. The Korean securityrelated issues have gained wider attention in India’s new regional posture in Asia.

Way Forward

• India’s significance for South Korea is growing primarily because of the latter’s deepening strategic dilemma with China – its largest economic partner. South Korea’s shifting perception about its economic engagement with China has influenced Seoul’s strategy towards other Asian powers. Against this background, policymakers in Seoul see India as a crucial partner and their government is taking various steps to upgrade ties under their new policy framework called the 'New Southern Policy.'
• India needs to take advantage of this opportunity. South Korea can be a major economic partner in India’s economic growth. After all, South Korea, which is Asia’s fourth largest economy, has become one of the fastest growing economies in the world in recent years. India should also pay particular attention to developing its strategic relations with South Korea. Such engagement with Seoul will also enhance New Delhi’s strategic leverage, especially in the Indo-Pacific region. As India is facing pressure from China in South Asia due to the ‘One Belt, One Road' initiative. India should design a similar type of strategy in East Asia. In this regard, New Delhi must nurture its relations with Seoul just as it has done with Tokyo in recent years. India and South Korea, two leading democracies in Asia, are natural partners and should closely work together to foster peace and stability in the region.