Chips to ships: South Korea, India must collaborate in additional sectors

Lee Jae-Myung's India visit highlights untapped potential in India-South Korea ties, from semiconductors to shipbuilding, amid a shared push for a stable Indo-Pacific

The visit of South Korean President Lee Jae-Myung to New Delhi is an opportune moment to reflect on the many ways in which the bilateral partnership, although deep and long-lasting in terms of economic interconnection, is nevertheless underperforming as compared to its considerable potential. South Korea is a major investor in manufacturing in India, with long-standing stakes in the automotive sector, for example. And the selfie taken with Prime Minister Narendra Modi and Mr Lee  by the chief executive officer of multinational conglomerate Samsung, with a phone that he said was made in its plant in Noida, is a reminder of how crucial a contributor South Korea has been to India’s recent successes in electronics assembly and exports. More will be expected, such as support for attempts at building manufacturing scale in various parts of the semiconductor supply chain. This has been a major priority for the government, and South Korea — one of the few countries in the world with the kind of manufacturing expertise that allows for the production of chips or of high-tech screens — will unquestionably play a large role in any rational plan for a further development of the electronics sector and moving it up the value chain.

 

There are also other sectors where there are shared abilities and a clear possibility for increased cooperation. Past attempts to scale up steel production in India have not entirely succeeded, but that is once again on the agenda. The sector needs investment, particularly in low-carbon technologies of the sort that will allow producers to export efficiently into areas that have emission-related barriers, such as the European Union. A major additional area of collaboration is shipbuilding. South Korea is one of the few countries that dominate that arena. It is vital from the perspective of derisking and resilience — not just in India, but for multiple other nations — that some alternative to China be developed when it comes to ship manufacturing. It would be dangerous if all maritime trade that props up liberal democracies is carried out on hulls made in China. Thus, incubation and growth in the Indian shipbuilding industry are a strategic imperative not just for this country but for all its partners.

 

There are opportunities from chips to ships to be worked on. However, the broader strategic vision underpinning this partnership must be understood. Seoul has come to understand that it can no longer be a free-rider on others’ policing and management of the Indo-Pacific. It has also stepped up to its responsibilities in the past years with sharply increased overseas development assistance in real terms. This has gone hand in hand with a more assertive approach to foreign policy in Southeast Asia and elsewhere, as well as sharp growth — almost from nothing — in its defence exports. The latter will certainly be on the agenda for India-South Korea cooperation. But it is even more important that both countries recognise that in their shared need for a stable, secure, and predictable Indo-Pacific, untroubled by Chinese coercion or American unpredictability alike, they have very few reliable partners other than each other.