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Prime minister Modi ’s visit to Korea heavily tilted towards business

Sunday, May 17th, 2015
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Mr. Chung Eui Hwa, the Speaker of the National Assembly of South Korea with Prime minister Nariendra Modi May 8, 2015

Indian Prime Minister Modi's maiden trip to South Korea as is scheduled for May 18-19, after  his visit to China and Mongolia.

From all the available sources in the public domain, it is becoming more and more clear our Prime Minister’s visit to Seoul will focus on economic and business promotion. If advance visits of Indian official to Seoul in recent weeks are any indication Strategic and security issues are not expected to get much attention and mostly likely put on the back burner.

It is hoped that the Prime Minister's May tour to these three countries might attract as much as $10 billion in financial assistance for his pet projects: Smart Cities, Digital India and Swachh Bharat Abhiyan.

South Korea has shown significant interest in these projects. Advance teams are currently negotiating terms and conditions for the infrastructure development package, which will be funded by South Korea's Export Import Bank. Sources have indicated that most of the assistance would be provided on a long-term basis at reasonable interest rates.

South Koreans have also shown great interest in his “Make in India” campaign. Indian delagates are said to be persuading big South Korean businesses to invest in India, and the Indian government is hinting that more infrastructure sectors could be covered following the bilateral negotiations to make the deal more attractive to South Koreans.

The Prime Minister is especially interested in developing closer ties with the shipbuilding industry, in particular those companies open to building ships in India. Knowing well that South Korea is a world leader in LNG transportation vessels, he has been encouraging India's private as well as state-run players to develop relations with Korea’s top shipbuilders such as Hyundai Heavy Industries, Daewoo, Samsung, STX, Hanjin, Sundong and Hyundai Samho; and looking into the possibility of making a ship in India for LNG imports. If a deal comes through this might be seen as one of the concrete outcomes of the visit.

Improvement of Indian Railways is also said to be on Mr. Modi’s mind. Thus cooperation in railways is likely to be another key item on the agenda during the PM's negotiations with the South Korean Government. It is said large potential exists to improve existing Indian rail tracks and South Koreans are said to be eager to exploit the available business possibilities in this sector.
All said, focus of the visit is going to be business and industry cooperation. All other important issues, including improvement in Comprehensive Economic Partnership Agreement, defense and strategic cooperation, are expected to be put aside. It needs to be remembered that bilateral trade which was growing at 30% per annum and reached $20.5 in 2011 has since declined to $18 billion because of serious flaws in CEPA. It has gotten so bad that today nobody even talks about a revised trade target of $40 billion by 2015 which was set just three years ago in 2012.

Security and strategic cooperation is said to be the last thing on Mr. Modi’s mind. Issues such as North Korea’s nuclear program, growing strategic imbalance of forces in East Asia, growing tensions in the South China Sea, growing restlessness and ultra nationalism in Japan and security of sea lanes of communications in Indian ocean are expected to get only passing attention from him.

Very sad news indeed. Japan learnt the bitter lesson that it does not work that way. Japan has around US$300 billion a year business with China but now is running here are there to protect itself against growing Chinese assertiveness. India will learn soon that you ignore your strategic and security interests at your own peril. Mr. Modi and his teams, going after South Korean capital in Seoul, completely oblivious to what is happening on the security front in the region, stands warned. History may not give them a second chance.

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