The study comes on a day when Commerce & Industry Minister Anand Sharma met his South Korean counterpart Minister of Trade, Industry and Energy Sang-jick in New Delhi.

New Delhi: South Korean investors are increasingly shying away from India owing to factors like excessive red tapism, poor infrastructure and complex tax policies, choosing other Asian counterparts like China and Hong Kong over the nation, an Assocham study has found.

The study comes on a day when Commerce & Industry Minister Anand Sharma met his South Korean counterpart Minister of Trade, Industry and Energy Sang-jick in New Delhi.

The other reasons working against India are protectionist labour laws, high licensing and inspection costs, congested judicial system and land acquisition problems, the study said.

"With just 1.25 percent share at $2.6 billion of South Korea's $215 billion worth total overseas investments till 2012, India figures quite low on the list of favoured investment destinations for South Korean companies".

Investors from South Korea have pumped in $39.67 billion in China, $14.18 billion in Hong Kong, $8.38 billion in Vietnam, $6.73 billion in Indonesia, $4.65 billion in Singapore, $3.95 billion in Malaysia and $3.81 billion in Japan," the study noted.

The study highlighted that there is vast scope to boost India-South Korea trade in services like information technology (IT), information technology enabled services (ITeS), communications, banking, insurance, education, broadcasting, tourism and healthcare.

"South Korean companies can forge business alliance with their Indian counterparts to become partner in infrastructure development as India plans to tap $1 trillion in infrastructure sector by 2017," it suggested.

Besides, there is tremendous potential for India and South Korea to work together and explore possibilities of promoting third country exports by taking advantage of the various rationalised procedures and investment norms applicable to the Special Economic Zones (SEZs), it said.

PTI