Seoul: Prime Minister Manmohan Singh said investment from South Korea was a priority for India, assuring a group of Korean businessmen that his government will take steps to address investors’ grievances and improve the business climate in Asia’s third largest economy.

Strengthening ties: Prime Minister Manmohan Singh (right) with US President Barack Obama before the start of the 2012 Seoul Nuclear Security Summit in Seoul on Monday. By AFP

He sought investments in projects for reducing India’s dependence on fossil fuels, while addressing South Korean businessmen on Monday.

“We are committed to increasing energy efficiency and the share of renewables, including solar and nuclear power, in our energy mix," Singh said. “There will be large business opportunities and I am aware of Korean capabilities in environmentally-friendly technologies."

Singh arrived in Seoul on Saturday for a bilateral visit and to attend the second Nuclear Security Summit on Tuesday.

Cooperation in the civil nuclear field was one of the subjects Singh discussed when he met South Korean President Lee Myung-bak at the president’s official Blue House residence on Sunday.

South Korea has asked India to allot land for its nuclear industry to build power plants. India is keen on the 1,400 megawatt electrical capacity plants that South Korea specializes in.

South Korea is the 14th largest foreign investor in India, with investments to the tune of $884 million (around 4,535 crore today) between April 2000 and January 2012, according to India’s department of industrial policy and promotion.

The country’s total investments in India—centred around Chennai, Pune, Noida and Gurgaon—constitute 1.24% of its total investments worldwide.

Referring to one of South Korea’s long-pending investment plans—a proposal by steel maker Posco to set up a $12 billion plant in India that has been stalled for almost seven years—Singh said the government “is keen to move forward with the Posco project and there is some progress in this regard. I believe India is a stable and profitable long-term investment opportunity".

Billed as India’s largest foreign direct investment, Posco’s plan to build a steel plant in Orissa has been delayed by farmers’ protests against the acquisition of land for the plant.

“We expressed that there was progress in the implementation of the Posco project. Both sides attach importance to it. We hope there is progress in the future," senior foreign ministry official Sanjay Singh told reporters later.

In a joint statement issued after the Singh-Lee talks, both sides stated their intent to scale up the bilateral trade target to $40 billion by 2015 from $30 billion in 2014.

Trade has registered a substantial jump—between 65% and 70%—following the operationalization of a Comprehensive Economic Partnership Agreement in January 2010. Trade in 2011 topped $20 billion. Singh “underlined the desirability of balanced trade relations" and “ways to facilitate greater market access for each other’s products and services", the statement said.

In his speech on Monday, the Prime Minister renewed his invitation to Korean companies to invest in in India’s infrastructure sector. “We are planning to secure investment of $1 trillion in the next five years in new projects in highways, power plants, mass transport systems, ports and airports," he said.

Among those who attended the business meeting with Singh were the Korea Federation of Small and Medium Businesses, the Korea Chamber of Commerce and Industry, Korea International Trade Association and the Federation of Korean Industries.

The companies represent power, shipping, automobiles, renewable energy, construction and telecommunications sectors.

PM meets Gilani

Prime Minister Singh also briefly met his Pakistani counterpart Yousuf Raza Gilani and US President Barack Obama at the dinner hosted by South Korean President Lee Myung-bak for the heads of state and government attending the second Nuclear Security Summit.

While it was a case of “meet and greet" with Gilani, Obama gave Singh a warm hug as they went in for the dinner, two people familiar with the events said. “There was no structured bilateral meeting with Gilani," one of them said, indicating that Singh and Gilani did not discuss any substantive issues.

The Uninor issue

Prime Minister Singh also met Norwegian Prime Minister Jens Stoltenberg on the sidelines of the Nuclear Security Summit. Singh promised his counterpart that a fair solution within the bounds of Indian law will be arrived at in the matter of Norwegian company Telenor ASA’s joint venture with India’s Unitech Ltd.

On 2 February, the Indian Supreme Court cancelled 21 licences held by Uninor, the joint venture, as part of its cancellation of 122 telecom licences that were allotted after 10 January, 2008. Telenor has said that it is looking at all possible solutions to the problem including international arbitration and legal recourse.

“The Indian Prime Minister spoke about a fair solution and said whatever is decided there would be equal treatment for all and there would be no political consideration favouring one group or the other. There would be fair treatment within the bounds of Indian law," a person familiar with the development said, requesting anonymity. Both the prime ministers “discussed Indo-Norwegian relations with specific reference to economic ties," foreign secretary Ranjan Mathai said. “The Telenor issue was discussed," he added.

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