South Korea will ask India to help its banks open branches in India when the finance ministers of the two countries meet on Wednesday to discuss cooperation in trade, taxation, banking, fiscal affairs and infrastructure development, among others.
The fourth finance ministerial meeting, to be held in New Delhi, will have Finance Minister P Chidambaram from the Indian side and Hyun Oh-seok, Deputy Prime Minister and minister of strategy and finance, from South Korea.
“They are seeking cooperation in the process for obtaining permission to establish branches of Korean commercial banks in India. Bilateral cooperation between supervisory agencies in the financial sector is also on the agenda,” a ministry official, who did not wish to be identified, told Business Standard.
Sinhan Bank was the first Korean lender to set up a branch in India, in 1996, at Mumbai. In April 2012, Seoul-based Woori Bank had launched its first branch in India, at Chennai, to assist Korean companies in the country and to serve local clients.
Samsung, LG, Hyundai, Daewoo and Posco are among the big Korean companies in India.
Deliberations will be held on revision of the Double Taxation Avoidance Agreement, to allow for greater exchange of information and making it more relevant.
India has been renegotiating its DTAAs with many countries, to check money being held abroad illegally by Indians.
The discussions will also touch on the macroeconomic situation.
The two sides will discuss collaboration under multilateral frameworks, including G-20 and the East Asia Summit.
Cooperation in public service and fiscal management will be another area.
It will include improving public procurement systems such as e-procurement.
The talks on cooperation in trade and investment will aim at establishing a map for mid-term and long-term cooperation, a Comprehensive Economic Partnership Agreement, reducing difficulties in Customs clearances, promoting small & medium enterprises’ cooperation and providing more investment opportunities.
Other issues include memoranda of understanding between the Export Import Bank of Korea and India Infrastructure Finance Company, for exchanging information on infra development projects in India, and an inter-bank export credit agreement between the Korean Export Import Bank with State Bank of India.