The South Korean government has given its approval to a free trade agreement, suggested by the government of India, that would allow both countries to greatly cut down on tariffs and enjoy a mutual financial relationship that would additional boost to the bursting economy of two of Asia’s leading economies. The vote on agreement was Seoul’s National Assembly and was unanimously passed with a vote count of 192-0, paving a way for strengthened economic ties.

For the last decade, the trade between India and South Korea has flourished greatly and has reached an astounding $15.6 billion as recorded for the year 2008. The latest trade pact, also known as the Comprehensive Economic Partnership Agreement is expected to take further the already iron clad economic ties, between both countries. India is known to be the third largest economy in Asia, closely followed by South Korea in the fourth place. The latest agreement calls for a 90% tariff reduction on all imported goods in South Korea and a 85% tariff cut on all commodities imported in India.

The current trade agreement is being viewed as a boon, especially for South Korea, who has been long trying to enter in to a free trade relationship with India, that would prove invaluable to Seoul’s economy. Two of the vital sectors of South Korean economy namely, electronics and automobile with big names such as Hyundai and Samsung will now be able to operate more freely in India. Seoul has already entered into similar contracts with the United States and the European Union, pending ratifications.

Via Associated Press.