Citibank Korea CEO Jin-Hei Park said the next wave of India-Korea bilateral investment will be driven by small and medium enterprises.
Recognising that the bilateral trade between India and South Korea is below its potential,Jin-Hei Park, Citibank Korea’s CEO opined that SMEs will be the major driving force behind the next generation of bilateral investment between India and Korea.
According to a recent report by the Times of India, bilateral trade between India and South Korea in 2017 totalled USD 20 billion, and investments have shown an upward trend. Both sides have pledged to increase it to USD 50 billion by 2030.
Highlighting the importance, Park said, half of the delegation that accompanied South Korean President Moon Jae-in last month to India were medium size enterprises from Korea looking to evaluate independent opportunities and not only just be a part of the supply-chain distribution for large companies.
Park is optimistic that the trade flows between Korea and India will be driven by large corporates setting up facilities across both markets primarily in the automotive and electronics sector.
He further stated that while Samsung and Hyundai will set up manufacturing facilities in India, Mahindra and Tata would do so in Korea. Elaborating the topic further he said that these large corporations will then bring their supply-chain partners to support their growth needs. And so, Hyundai and Kia will ensure that their ancillary partners also set up facilities along with them as part of the supply-chain process.
Citing example of Kia Motors, Park said, the company is investing around USD 1.2 billion, but the total FDI inflow will be around USD 2 billion when combined with the investment from its suppliers. Such investments have a significant impact on the local economy and we have seen this time and again in other markets too, he said.