Maroc - EURASIAREVIEW.COM - A la une - 09/Aug 19:46

India-Vietnam Ties – Analysis

The long-awaited State visit to India by the Prime Minister of Vietnam Pham Minh Chinh from July 30-August 1 was significant in more than one way. Prime Minister Narendra Modi’s media statement in Hindi soon after a Joint Statement on Strengthening of the Comprehensive Strategic Partnership was issued in which he observed that in India’s Act East Policy and Indo-Pacific Vision, Vietnam is an important partner. Modi reiterated that India supports development, “not expansionism” (Hum vistarbad nahi, vikasbad ka samarthan karte hei). He was indirectly referring to concerns over China’s military posturing in the region in recent times. Both sides adopted an action plan to expand their strategic ties and committed to jointly work together for a free, open, rules-based and prosperous Indo-Pacific. The two sides signed six memorandums of understanding (MoUs) and finalised three other documents to broad-base cooperation in a range of areas following wide-ranging talks. Vietnam has emerged as a key partner for India among members of the ASEAN for both trade and security issues. From its side, Vietnam has looked to bolster its defence and security ties with India against the backdrop of the territorial disputes with China in the South China Sea. The new Plan of Action aimed to strengthen the bilateral comprehensive strategic partnership established in 2016 during PM Modi’s visit to Vietnam. This visit was marked by a high-level of political trust and fruitful collaboration in national defence, economy-trade and investment, culture-education, and people-to-people exchange. India decided to provide $300 million credit line to Vietnam primarily to strengthen the Southeast nation’s maritime security. Both sides agreed to redouble their efforts for peace, stability and security in the South China Sea, and for the peaceful settlement of disputes based on respecting international law, especially the United Nations Convention on the Law of the Sea (UNCLOS) of 1982. Both committed for the safety, security and freedom of navigation and over-flight. Chinh proposed that in the field of trade and investment, the two sides should double bilateral trade and development over the next three to five years for which a new mechanism would be needed. To realise this, it was decided that the two sides shall establish an economic diplomacy units at the level of the deputy foreign minister. Delivering a lecture at the Indian Council for Word Affairs in Sapru House, Chinh suggested that the two countries should work on a new trade and economic cooperation agreement. Chinh invited greater Indian investments in key areas such as infrastructure, air and maritime connectivity and oil and gas. An agreement was sealed between the central banks of the two countries for rolling out digital payment connectivity. Modi committed to strengthen cooperation to deal with terrorism and cyber security issues. Both sides agreed that 'Developed India 2047' and Vietnam's 'Vision 2045' have accelerated development in both countries and the road is open to broaden many new areas, including defence, for deepening mutual cooperation. Vietnam welcomed Indian investments in high technology, IT, manufacturing industries, textiles, semiconductors, renewable energy. India sought investment from Vietnam in agriculture, aquaculture, wood processing, urban development, production of bamboo and forestry products, digital technology and e-vehicles. Thus, while strengthening traditional areas of cooperation, there is a desire and plan in place to expand into emerging areas under the principle of higher political trust, broader joint work in sci-tech and innovation, and closer cultural and people-to-people exchanges. Since PM Modi’s visit to Vietnam in 2016, two-way trade has skyrocketed, tripling from over $ 5 billion in 2016 to $ 15 billion in 2023. Both sides concurred to adopt strong measures to double the current trade and investment by 2030, including instructing relevant agencies to utilise existing mechanisms for regular exchanges to eliminate trade barriers and enhance trade promotion efforts. The opening of the first direct air route between the two countries in 2019 dramatically increased Indian tourist arrivals in Vietnam from 170,000 in 2019 to 400,000 in 2023. At present, there are 56 flights a week between major cities of the two countries. The defence and strategic component, alongside the economic and cultural aspects of bilateral ties, have blossomed on the foundation of the 52-years of bilateral ties. These have helped meet the legitimate interests and aspirations of the people of the two countries. Both Modi and Chinh pledged to maintain regular exchange of all-level delegations across various channels and decided that the two PMs would meet annually, either through visits or on the sidelines of multilateral conferences. They also underscored the importance of strengthening further the role of the Joint Commission meeting co-chaired by the two foreign ministers to review and concretise cooperation and oversee the effective implementation of the 2024-2028 Action Plan for the comprehensive strategic partnership. Against the backdrop of the Joint Vision Statement on the Vietnam-India Defence Partnership toward 2030 signed in 2022, the two PMs vowed to expand coordination in defence and security industries, and maritime security, and build reliable partnerships in cyber-security, intelligence sharing, and counter-terrorism. India is committed to continuing support to the ongoing training and capacity-building for Vietnam’s defence and security forces. Vietnam expects India to actively consider proposals from Vietnamese firms regarding the issuance and renewal of the Bureau of Indian Standards (BIS) certificates for goods imported from Vietnam. Also, an early signing of agreements on e-commerce and bilateral trade shall go a long way to fully tap into the growing retail market. Potential new areas for cooperation are in core technology, AI, innovation, rare earth exploitation and processing technology, and working towards the early establishment of a digital partnership forum and the signing of a digital partnership agreement. There were indications that India was not happy that Vietnam delayed on its decision to join PM Modi’s three important initiatives announced before – Coalition on the Disaster Resilient Infrastructure (CDRI), International Solar Alliance (ISA) and Global Bio-fuel Alliance Initiative (GBAI). India was pleased with Chinh’s decision to join the CDRI, and assurance of early completion of domestic procedures to officially join the ISA. Chinh also appreciated PM Modi’s idea of GBAI. PM Chinh invited his Indian counterpart to visit Vietnam again. Overall it was a productive visit.