Given the two firms' battery production capacity and global competitiveness, industry watchers viewed the decision as a thinly veiled retaliation against Seoul's deployment of an American missile defense system on its soil in March 2017. 

South Korean battery manufacturers have struggled in the Chinese market as the Chinese government began to withdraw subsidies for local electric cars that use Korean batteries in late 2016. State subsidies can cover as much as half of the price of the cars sold in the world's largest electric vehicle market. 

The industry ministers' meeting came one day after the Chinese government posted a list of car models that are to be subsidized.

It did not include models like the Dongfeng KIA and the Dongfeng Renault that use LG Chem power packs.

Though the Korean batteries haven't qualified for government subsidies, China's Association of Automobile Manufacturers on Tuesday published a "white list" of high-performing companies that includes LG Chem, Samsung SDI and SK Innovation. 

As the two nations agreed to normalize their diplomatic relations in late 2017, Paik said he hopes that the Chinese government is giving a positive signal for the use of Korean batteries in electric vehicles. 

"Korean battery makers' being included in the white list does not directly lead to a Chinese government decision to offer subsidies, but it means that their advanced battery technology is acknowledged in the market," Paik told reporters. "I hope the Chinese government gives the right signal in the market to promote the use of Korean batteries in electric vehicles." 

In 2015, LG Chem built a battery plant capable of supplying batteries for 100,000 electric vehicles in the eastern Chinese city of Nanjing. In the same year, Samsung SDI built a plant in Xian, central China, that can provide batteries for 150,000 electric vehicles. (Yonhap)