SEOUL, May 4: A host of South Korean business groups are preparing to invest heavily in India through joint ventures and cent-per-cent subsidiaries, thereby catapulting this South-East Asian country to the second largest investor after the United States. Foreign direct investment (FDI) approvals from South Korea were to the tune of Rs 3221 crore last year, behind the US, which approved investments worth Rs 10,056 crore in various sectors. In January 1997 alone, South Korean companies announced plans to invest Rs 1,679 crore in various sectors in India. According to Shashank, India's Ambassdor here, Korean companies have so far invested over Rs 700 crore in India. ``The actual inflow is expected to go up after Korean companies finalise their plans in India,'' he said. The South Korean foray into India is led by big conglomerates (chaebols) like Samsung, Hyundai, LG group and Daewoo. Samsung Electronics, part of the $ 87 billion Samsung group, is already operating in the electronics business through its joint venture Samsung India Electronics. It is also setting up a cent-per-cent-owned subsidiary by the year-end. Hyundai, the leading automobile manufacturer in Korea, is investing $ 1.1 billion in a brand new plant near Chennai. The Hyundai plant, which is expected to start manufacturing cars in India by December 1997, will also introduce its MX model small car in India. Daewoo, which manufactures the Cielo cars in India, has plans to introduce its small car. The LG group is planning to invest around Rs 500 crore through its cent-per-cent subsidiary. Kia, a major player in the automobile sector, is also looking for investments. Another prominent Korean automobile company waiting to make investments is Ssang Yong which is considering a joint venture. Daelim an engineering firm which is also making scooters - is also looking for investment opportunities. Hansol, another Krean company, has tied up with Sri Venkateshwara Paper Mills and Kesariwal Industries in to manufacture high quality paper. The lion share of the investments will go to the automobile and consumer electronics sectors. Shashank said major efforts are being made to attract South Korean investments in a big way. ``We are getting Indian trade delegations to visit South Korea so that India can take advantage of Korean business interests,'' he said. According to Seung-Taek Shin, general manager, India Desk, Samsung Electronics, the Samsung group is committed to its investment plans of around Rs 630 crore. Indian embassy sources here said South Korea which is now undergoing a major restructuring process in line with the World Trade Organisation (WTO) commitments has embarked on a globalisation drive focussing on countries like India. India's trade with Korea is expected to shoot up to $ 5 billion by 2000 from around $ 2 billion now. A major chunk of South Korea's exports to India are in electronics trade including semi-conductors. India exports edible oils, iron ore, agricultural products and marine foods to South Korea. ``Efforts are being made to diversify the export basket to include leather goods and garments in a big way,'' Shashank said.
