The South Korean President’s recent visit to India generally doesn’t move beyond headlines, as this usually means trade commitments, bilateral dialogue and various announcements. But this time, President Lee Jae-myung’s visit to India comes at a time when both countries need each other, and the event is bound to cement long-standing partnerships.
For India, this visit mattered more than just optics, as South Korea’s status as one of the leading industrial economies will be crucial to boost India’s Make in India initiative.
South Korea has been a world leader in manufacturing, placing immense emphasis on scalable innovation, problem-solving, and incremental growth in its industrial production. After liberalization, South Korean enterprises have been leading India’s industrialization drive, with many of them setting up local manufacturing units.
As one of the leading Asian Tiger Economies, its relentless focus on solving real-world engineering challenges has helped it transition to a developed, export-driven economy. The country’s famed conglomerates, also called ‘chaebols’ have dominated the economy and have been
How the partnership has worked so far
Over the years, Samsung, LG, Hyundai and POSCO have cemented their place in India’s economy, with their smartphones, consumer durables and steel, respectively. Over the years, they’ve scaled up these operations, while expanding their assembling and manufacturing bases here for exports to other emerging markets across the world.
These companies have been assembling and exporting their products from India long before India became the second-largest smartphone exporter. Hyundai was one of the first carmakers to set up an independent subsidiary in India, and has risen to be one of the largest carmakers in the country, with about 21% of its output exported worldwide.
Besides this, South Korean companies have assisted India in developing the capabilities to manufacture advanced equipment, mostly through JVs, technical collaborations, and skill development sessions.
Why India needs South Korean help to Make In India
In South Korea, India gets a willing partner who does not hesitate to share technological expertise. As one of the leading Asian industrial powers, South Korea is even willing to transfer technology to Indian SMEs to integrate them into its global value chains.
But South Korea isn’t just about electronics or smartphones- they are the world leaders in shipbuilding, nuclear power, defence equipment, EVs and semiconductors. To fulfill Prime Minister Modi’s dream of becoming a manufacturing powerhouse, India requires South Korea’s mentorship and technical expertise to make it happen.
Why South Korea is in a vulnerable position
The recent disruption in energy supplies from the Middle East has affected South Korea more severely than ever, as it imports nearly 94% of its energy needs. India has been better prepared for this disruption, and can help South Korea secure energy supplies as well.
Besides, South Korea is facing a demographic challenge, as the shortage of young people is starting to affect its economy. Its domestic market is limited, and its traditional export markets- Europe and China are slowing down due to high inflation and a lack of discretionary spending.
The ‘natural’ partner
In India, South Korea has a ready market for its goods, and its already established companies help navigate regulatory hurdles and meet market demand. Multiple countries have already approached South Korea for its capital and industrial partnerships, but India has a compelling case – with ready digital infrastructure, abundant labor, and geopolitical relevance.
The South Korean President’s 3-day visit to India, the first by a South Korean President in eight years, has opened the floodgates to boost bilateral trade, deepen technological cooperation and strengthen both economies as they navigate fresh challenges in a multipolar environment.
