From X:

From X: South Korea has played really smart with India. FDI Comparison- Korea total investment in Vietnam is 13-14 times higher than in India. Vietnam economy is only 1/10th India's size. Samsung alone exports $54 billion a year from Vietnam. India has huge market but gets less factories and jobs. Vietnam got the real manufacturing boom. Even Recently Samsung going to build new factory there in Vietnam, in case of china we know the problem but in case of South Korea they do business under Radar, even this is bigger than i Imagine How South Korea Used free trade deal with India is just a Case study - when yu read it in detail yu will get it. Korea got a free trade deal (CEPA) in 2010. Under that deal, Korean goods entered India at zero or low duties. Samsung, Hyundai, LG used this to sell massively into India - phones, cars, appliances. India's imports from Korea went from $10B to $21B. India's exports to Korea actually fell - from $8B (FY22) to $5.8B (FY25). The trade deficit tripled from $5B to $15.2B. But selling wasn't the only play. The real play was value extraction: Hyundai - Paid itself a ₹10,782 crore special dividend (7.2x its normal payout), then did India largest IPO - 100% offer-for-sale. Every rupee of the $3.3B IPO went to the Korean parent. Then raised royalty rates from 2.5% to 3.5% per car. Three moves, one after another, all designed to drain cash from the Indian subsidiary to Seoul. LG - Same template. 100% offer-for-sale IPO, $1.4B to the Korean parent. The Indian subsidiary now trades at $12.5B market cap - higher than the Korean parent itself. LG used Indian investors money to value an Indian business that it still controls and still pulls dividends from. Samsung - Royalties paid to Korea jumped 50% to ₹3,322 crore in one year. After Korea changed its tax law in 2023 (no tax on foreign dividends coming home), Samsung pulled ₹22B worth of dividends from all overseas units in 9 months. India was one of the biggest sources. Combined - Hyundai + LG alone pulled $4.7B out of India in 12 months. All legal under CEPA. Best way to fuck RBI stricter Foreign Outflow What Korea did in Vietnam (same period) Korea put $92B of FDI into Vietnam. India got $6.7B. India economy is 10x Vietnam size. Samsung alone runs 6 plants in Vietnam, employs 100,000 people, exports $54B/year from there - that's 13% of Vietnam's entire exports. Vietnam got factories + jobs + exports. India got imports + deficit + cash extraction. Why Delhi stayed quiet for 15 years Diplomatic politeness. Also, during 2010–2020, India negotiating leverage was weaker. India needed Korean investment, Korean tech, Korean defence platforms. So the imbalance was a known problem that time but that time of dealmaker didn't think of long term MEA Secretary Kumaran publicly named the $15.2B deficit before President Lee landed. Commerce Minister Goyal called the 2010 CEPA irrational and lopsided. This was intentional signaling. What India wants in CEPA 2.0 - Four things: Services access - Indian IT exports to Korea are only $200M (vs $200B globally). India wants visa quotas for Indian engineers in Korean semiconductor/AI projects, and recognition of Indian professional qualifications. Pharma access - Indian generic drug exports to Korea are just $167M. Korea has rules that kill generic price advantage. India wants those removed. Forced local content - Like what Vietnam and Indonesia did. India wants 50% local value-addition by year 5, 70% by year 10. If you want to sell in India, build in India. Reciprocal sourcing - For every $1B defence/steel/shipbuilding contract India gives Korea, Korea must buy equivalent value of Indian services, pharma, components.