India-Vietnam Relations

Why in the News?

The recent state visit by the Prime Minister of Vietnam to India has strengthened bilateral ties and yielded several key outcomes.

Key Outcomes of the Visit

• Plan of Action (2024-2028):
• A comprehensive plan was announced to implement the Comprehensive Strategic Partnership between India and Vietnam.
• Line of Credit:
• India extended a US$ 300 million credit line to enhance Vietnam's maritime security capabilities.
• Cultural Cooperation:
• A Letter of Intent was signed to conserve and restore the "My Son" World Heritage Site temples, highlighting a commitment to cultural heritage.
• MoUs Signed:
• Agreements were established for cooperation in radio and television and for the development of the National Maritime Heritage Complex in Lothal, Gujarat.
• Other Announcements:
• Virtual inauguration of an Army Software Park in Nha Trang, Vietnam.
• Vietnam's participation in the Coalition for Disaster Resilient Infrastructure (CDRI) was confirmed.

Historical Context

• Support for Independence: India supported Vietnam's struggle for independence from France and opposed US involvement during the Vietnam War. India was one of the first countries to recognize a united Vietnam in 1975.

Strategic Partnership

• Evolution of Ties: Bilateral relations were elevated to a Strategic Partnership in 2007 and further to a Comprehensive Strategic Partnership in 2016, guided by the Joint Vision for Peace, Prosperity and People 2020.

Economic Cooperation

• Trade Volume: Bilateral trade reached US$ 14.82 billion in 2023-2024, with Vietnam being India’s 23rd-largest global trade partner and 5th largest among ASEAN countries.

Defence Cooperation

• Multi-faceted Engagement: Defence cooperation includes dialogues, training exercises (like PASSEX, VINBAX, and MILAN), and capacity-building collaborations. In 2022, a Joint Vision Statement on Defence Partnership towards 2030 was signed, alongside a Memorandum of Understanding on Mutual Logistics Support.

Supply Chain Integration

• Strategic Role: The partnership with Vietnam is crucial for India’s participation in building resilient regional and global supply chains, enhanced by Vietnam's Free Trade Agreement with the European Union.

Cultural Ties

• Shared Heritage: India and Vietnam have over 2,000 years of cultural and civilizational ties, with a strong connection through their shared Buddhist heritage.

Significance of Vietnam for India

Geostrategic Location

• Indo-Pacific Cruciality: Vietnam's position is vital for securing trade routes in the Indo-Pacific, enhancing regional stability.

Countering China

• Shared Concerns: Both countries face challenges from China; India in Ladakh and Arunachal Pradesh, and Vietnam over claims in the Paracel and Spratly Islands.
• Advocacy Against China: Vietnam is a strong advocate against China's unilateral actions in the South China Sea, aligning interests with India.

Energy Security

• Hydrocarbon Investments: Indian investments in Vietnamese oil and gas exploration bolster energy security, ensuring a consistent supply of hydrocarbons.

Act East Policy

• Core Partner: Vietnam is a key ally in India’s Act East policy and integral to India's broader Indo-Pacific vision.

Support on Global Platforms

• UN Security Council: Vietnam actively supports India's bid for permanent membership in an expanded UN Security Council.

Challenges in India-Vietnam Relations

Balancing China

• Cautious Approach: Vietnam’s apprehension of provoking China limits the depth of military ties with India, impacting joint security initiatives.

Modest Trade

• Trade Volume Disparity: Despite increasing trade, it remains small compared to Vietnam's larger trade volumes with China and the U.S.

Trade Routing Issues

• Supply Chain Dynamics: The rise in trade through Vietnam, partly due to Chinese firms rerouting supply chains, complicates India’s trade strategy.

Reluctance in Military Deals

• Limited Military Purchases: Vietnam has hesitated to fully utilize India's line of credit for military purchases, avoiding some key acquisitions.

Cultural Gaps

• Understanding Barriers: Differences in culture, customs, and language create challenges for deeper people-to-people connections.

Initiatives to Strengthen Relations

• Mekong-Ganga Cooperation (MGC): This initiative fosters collaboration in tourism, culture, education, and transport among India and five ASEAN nations, including Vietnam.
• Quick Impact Projects: Implemented in various Vietnamese provinces to promote immediate developmental benefits.
• Capacity Building: India provides training and educational opportunities for Vietnamese nationals.
• Defense Cooperation: India delivered the indigenously built missile corvette INS KIRPAN to Vietnam in 2023, enhancing maritime capabilities.

Way Forward

Enhancing Economic Cooperation

• Joint Ventures: Promote collaborative economic initiatives, boost digital and physical connectivity, and enhance market access for both nations.

Bridging Connectivity Gaps

• Trilateral Highway: Development of the India-Myanmar-Thailand trilateral highway can improve links to Vietnam's Da Nang port.

Deepening Cultural Cooperation

• Strengthening Exchanges: Increase people-to-people interactions to leverage existing goodwill and cultural ties.

Realizing Converging Interests

• Indo-Pacific Strategy: Both nations are positioned strategically within the Indo-Pacific, and their cooperation will be crucial in shaping the region's geopolitical landscape amidst growing global competition.