India and South Korea target $50bn trade as both seek deeper economic ties
Summary:
- South Korea’s Lee visits India for first time in eight years
- Target to double trade to $50bn by 2030
- Focus on shipbuilding, AI, finance, defence cooperation
- Supply chain risks driving closer ties
- Korea seeks more naphtha from India
- Trade imbalance remains a key issue
South Korean President Lee Jae Myung is set to meet Indian Prime Minister Narendra Modi in New Delhi, aiming to significantly deepen economic ties as both countries look to strengthen resilience against global supply chain disruptions.
The visit marks the first South Korean presidential state trip to India in eight years, underscoring a renewed push from Seoul to elevate the relationship. Officials from both sides are targeting a near doubling of bilateral trade to $50 billion by 2030, up from roughly $25.7 billion last year, as part of efforts to upgrade their existing Comprehensive Economic Partnership Agreement.
Lee has framed the partnership as strategically important in an increasingly fragmented global economy, particularly given ongoing disruptions linked to the Iran war. He emphasised that cooperation between South Korea and India could expand materially across key sectors, including shipbuilding, finance, artificial intelligence, and defence.
A major focus is supply chain security. South Korea has already turned to India to help offset risks stemming from Middle East tensions, including a recent request to increase naphtha supplies, a key petrochemical feedstock. India currently accounts for a modest share of South Korea’s imports, but officials see scope to expand flows as part of a broader rebalancing of trade.
The relationship also reflects shifting perceptions of India’s role in the global economy. Lee described India as evolving beyond a consumption-driven market into a critical node in global production and supply chains, making it an increasingly attractive partner for industrial collaboration.
However, structural challenges remain. South Korea runs a sizeable trade surplus with India, a longstanding source of friction that both sides are seeking to address through deeper cooperation and expanded imports. Analysts suggest sectors such as shipbuilding, which aligns with India’s employment priorities and South Korea’s industrial expertise, could provide a pathway for more balanced growth.
Lee’s visit is also expected to include meetings with business leaders, reinforcing the commercial dimension of the partnership. He is scheduled to travel onward to Vietnam as part of a broader regional engagement strategy.
This reflects a structural supply chain realignment theme, with Asia increasingly looking inward to offset geopolitical risk. Greater Korea–India integration could support regional trade flows, particularly in energy inputs and industrial sectors. While not an immediate market mover, it reinforces the broader trend of diversification away from traditional routes, which has implications for commodities, shipping, and long-term growth dynamics across Asia.
This article was written by Eamonn Sheridan at investinglive.com.