New Delhi, 18 February 1974 The Government of the Republic of INDIA
AND
The Government of the Democratic People’s Republic of KOREA.
DESIROUS of developing further the existing trade relations between the two countries on the principles of equality and mutual benefit.
HAVE AGREED as follows :
Article 1
The export of goods from the Democratic People’s Republic of Korea to India and from India to the Democratic People’s Republic of
Korea during the period of validity of this Agreement will be carried out in accordance with the list agreed upon between the two
Parties for every calendar year.
Lists ‘A’ and “B’ attached to this Agreement are indicative lists of goods available for export from either country. These lists can
be extended, altered or renewed by letters exchanged between the two Parties.
Article 2
The import and export of goods under this Agreement will be carried out in accordance with the import, export and foreign exchange
laws, rules and regulation and procedure in force in the two countries and on the basis of contracts to be concluded between the
trading corporations of the Democratic People’s Republic of Korea on the one side and the Indian physical and juridical persons including
Indian State-owned organisations on the other. The two parties, however, undertake to grant maximum facilities allowed by their respective
laws, rules and regulations for the goods imported from one country to the other.
The two Parties shall also take necessary measures including the issue of export and import licences for the exchange of commodities
mutually agreed upon.
Article 3
(1) The goods exchanged between the two countries shall enjoy full most-favoured nation treatment with respect to custom duties and
charges of any kind imposed on exports or imports or in connection therewith, with respect to the methods of levying such duties
and charges and application of rules, formalities and charges in connection with customs clearing operations as well as charges of
any kind imposed on or in connection with the imported goods.
Any advantage, favour, privilege or immunity granted by either Party to export or import of any product originating in the territory
of a third country or destined for its territory, shall be accorded immediately and unconditionally to the like product originating
in the territory of either Party or destined to be imported into its territory.
(2) The provisions of this Article shall not apply to the grant or continuance of any :
(a) Privileges which are or will be granted by either Party to contiguous countries in order to facilitate frontier traffic, and
(b) Preferences, advantages, privileges or immunities accorded by either country to any third country and which are in force at the
time of the Agreement or in replacement thereof.
Article 4
(1) All payments of commercial or non-commercial nature between physical and juridical persons residing in the Democratic People’s
Republic of Korea and physical and juridical persons residing in India shall be effected in non-convertible India rupees.
(2) For the purpose of effecting the payments referred to in paragraph (1) of this Article :
(a) The foreign Trade Bank of the Democratic People’s Republic of Korea acting on behalf of the Government of the Democratic People’s
Republic of Korea will maintain a central clearing Account – ‘Democratic Peoples’ Republic of Korea-India’ with the Reserve Bank
of India and one or more account(s) with one or more commercial bank(s) in India, authorised to deal in foreign exchange.
(b) The Central Clearing Account ‘Democratic People’s Republic of Korea-India’ maintained by the Foreign Trade Bank of the Democratic
People’s Republic of Korea with the Reserve Bank of India will be used for depositing the rupees holdings of the Foreign Trade Bank
of the Democratic People’s Republic of Korea and for replenishing the account(s) of the Foreign Trade Bank of the Democratic People’s
Republic of Korea with the authrorised Indian Commercial Bank(s) and for operating the short-term financial accommodation.
(c) The account(s) maintained by the Foreign Trade Bank of the Democratic People’s Republic of Korea with the Indian Commercial Bank(s)
will be used for carrying out all operations connected with the payments of commercial or non-commercial nature except those pertaining
to the Central Clearing Account ‘Democratic People’s Republic of Korea-India’ as mentioned above.
(d) The Central Clearing Account ‘Democratic People’s Republic of Korea-India’ will be replenished by transfer of funds in Indian
rupees from the account(s) maintained by the Foreign Trade Bank off the Democratic People’s Republic of Korea with the Indian Commercial
Bank(S) and by receipts under the short-term financial accommodation.
(e) The account(s) with the Commercial Bank(s) will be replenished by transfer of funds from other similar account(s) and from the
Central Clearing Account ‘Democratic People’s Republic of Korea-India’.
Article 5
The payments permitted in accordance with the Indian Foreign Exchange Control Laws and Regulations shall be effected, on the basis
of this Agreement, to the physical and juridical persons residing in the Democratic People’s Republic of Korea by the physical and
juridical persons residing in India, by crediting the amount of such payments to the account(s) of the Foreign Trade Bank of the
Democratic People’s Republic of Korea with the Indian Commercial Bank(s). Likewise the payments which are to be effected by the physical
and juridical persons residing in the Democratic People’s Republic of Korea to the physical and juridical persons residing in India
in accordance with the Korean foreign exchange control laws and regulations, will be effected by debiting the account(s) maintained
by the Foreign Trade Bank of the Democratic People’s Republic of Korea with the Indian Commercial Bank(s) under the instructions
of the Foreign Trade Bank of Democratic People’s of Korea.
Article 6
The details in regard to the procedure for the operation of the Central Clearing Account will be mutually agreed upon between the
Foreign Trade Bank of the Democratic People’s Republic of Korea and the Reserve Bank of India at the earliest practicable date.
Article 7
(1) Any balance in Rupee Accounts of the Foreign Trade Bank of the Democratic People’s Republic of Korea or any debt in connection
with the grant of short-term financial accommodation will, upon expiry of this Agreement be used during the ensuing twelve months
for the purchase of such Indian or Korean goods as the case may be, as were eligible for exchange during the previous year or for
other payments of a commercial and non-commercial nature between India and the Democratic People’s Republic of Korea.
(2) Payments arising from contracts concluded before the expiry of this Agreement but falling due after the expiry of this Agreement,
shall, not-withstanding the expiry of this Agreement, be effected in accordance with the provisions of this Article and be utilised
in the same manner as the balance referred to in paragraph (1) of this Article during the ensuring twelve months after each such
payment.
In both case, after the expiry of the said twelve month’s period any balance outstanding shall be settled in such manner as may be
agreed upon between the two parties.
Article 8
(1) The two Parties would endeavour in exercise of their right of shippers’ preference to utilise to the maximum extent possible the
vessels owned or chartered by shipping organisations of the two countries for shipping cargoes imported or exported under this Agreement
on the basis of world competitive freight rates and conditions.
(2) The most-favoured nation treatment will apply also to the ships of the both countries in respect of port taxes to be levied, in
respect of the privileges rendered at entering or leaving the ports as well as in regard to the regulation in force regarding the
stay of ships, the crew, the goods, passengers at the ports, and in respect of loading, unloading and transhipment of the goods.
The treatment referred to in paragraph (2) of this Article shall not apply to ships engaged in coastal navigation.
Article 9
The commodities exchanged between the two Parties shall be for consumption in their respective countries and shall not be re-exported.
Article 10
The prices of the commodities to be exchanged under this Agreement shall be fixed in accordance with international prices, taking
into account the quality and technical specifications at the time of concluding the contracts.
Article 11
In order to facilitate the implementation of this Agreement the two Parties agree to consult each other at the request of either Party
in respect of matters connected with trade and payments between the two Parties.
For this purpose, the representatives of the two Parties will meet at the request of either party, at a place and time to be mutually
agreed upon, the meeting being held within 60 days of the receipt of the request.
Article 12
This Agreement shall come into force as from the date of its signature and shall remain valid for a period of three years and in case
neither of the Contracting Parties shall give written notice three months before the expiry of the said period of its intention to
terminate this Agreement, it will automatically be extended each time for a further period of one year.
With the conclusion of this Agreement, the letters exchanged on 9th December, 1968, between the two Parties shall automatically lapse
and all contracts concluded and their payments under those letters but not yet executed, shall be implemented under this Agreement.
DONE and made in New Delhi, on 18th February, 1974, in three originals in Hindi, English and Korean languages, all texts being equally
authentic.
Sd/-
A.S. GILL
By authorisation of the Government of the Republic Of India Sd/-
KIM SOK JIN
By authorisation of the Government of Democratic People’s Republic of Korea
_________
LIST ‘A”
COMMODITIES AVAILABLE FOR EXPORT FROM DEMOCRATIC PEOPLE’S
REPUBLIC OF KOREA TO INDIA
1. Machinery.
2. Transformers.
3. Rock-drill and accessories.
4. Rims and accessories of wagons
5. Various kinds of tools
6. Graphite electrodes
7. Carbon rods
8. Magnesia clinker
9. Anthracite coal
10. Fluorspar (acid grade)
11. Graphite crystalline.
12. Graphite amorphous
13. Various kinds of refactories
14. High speed steel
15. Forging quality steel
16. Carbon tool steel
17. Spring steel
18. Alloy tool steel
19. Alloy structural steel
20. Stainless steel
21. Mild steel plates
22. Seamless steel tubes
23. Mild steel billets
24. Free cutting steel
25. Zinc
26. Lead
27. Other non-ferrous metals and their products
28. Peppermint oil
29. Sodium bicarbonate
30. Polyvinyl alcohol
31. Calcium carbide
32. Arsenic trioxide
33. Various chemicals
34. Urea and other fertilizers
35. Vinalon fibre and other synthetic fibres.
36. Hops
37. Red Insam
38. Insam products
39. Medical herbs
40. Dye and dye intermediates
41. Fog type insulators
42. Others.
___________
LIST ‘B’
COMMODITIES AVAILABLE FOR EXPORT FROM INDIA TO THE DEMOCRATIC
PEOPLE’S REPUBLIC OF KOREA
1. Buses and their accessories
2. Trucks and their accessories
3. Dumpers
4. Machinery
5. Mobile service stations
6. Various kinds of tools
7. Bearing
8. Chrome ore
9. Manganese ore
10. Mica and mica products
11. Bauxite
12. Wire-netting for paper making
13. Wire rope
14. Shellac
15. Chemicals and other chemical products
16. Various kinds of dye stuffs and dye intermediate
17. Drugs and pharmaceuticals
18. Glycerine
19. Tyres and tubes
20. Jute and jute products
21. Textile (cotton, woolen, silk and synthetic)
22. Cotton and rayon yarn
23. Oil for production of soaps
24. Leather and leather goods
25. Black pepper and other spices
26. Central air conditioning plants
27. Commercial refrigeration equipments
28. Electrical goods
29. Automobile ancillaries
30. Detergents (Washing powder)
31. Coir goods
32. Tabacco
33. Cigarette paper
34. H.P.S. Groundnut
35. Rubber
36. Others
