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India, Vietnam could emerge as key pillars of global supply chain initiative. Dipanjan Roy Chaudhury. Rate Story. Font Size Abc Small. Abc Medium. Abc Large. Agencies There is an opportunity for low and middle-income countries to work with developed nations to move supply chains away from China.
This means that we are moving towards more balanced trade between India and Vietnam. Exports from India are led by iron and steel, followed by meat and seafood. Bovine meat has always been a very important commodity that Vietnam imports from India. But you will see a surge in sea food exports from India to Vietnam. Since we enjoy zero tariffs, we purchase a lot of raw material from different countries, process and re-export to this European market.
Seafood imports from India form a part of this trade. The third largest import from India is cotton and the fourth is pharmaceuticals. Another new development that I see is the focus on auto parts and machinery, also a source of import from India to Vietnam.
We have discussed with many automobile companies and also conducted one business trip to Chandigarh and neighbouring areas; talking to automobile companies, since we want them to invest in Vietnam.
So they can not only provide to the Vietnamese market, but also to other markets with whom Vietnam has a free trade agreement. Indians have started using more Vietnamese coffee. And since they are shifting from a tea drinking culture to coffee drinking, it is a very significant development. Nifty 17, Honeywell 45, Market Watch.
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India has also established a satellite tracking facility in Ho Chi Minh City. Although termed a civilian facility, it could provide strategic benefits such as the tracking of Chinese movement in the sea, in case of a threat. It has been planned and implemented by the Indian Space Research Organisation. Vietnam and India have a long traditional friendship. India ranks 26th among the countries and territories which have invested in Vietnam FIA, Manufacturing and processing industry ranks first with 52 projects having total registered capital of approximately USD The second ranking sector is wholesale, retail and repairing automobiles, motorcycles, motorbikes with 51 projects with registered capital of USD 9.
Howerver, production and distribution of electricity, gas, water, air conditioning sector with only 4 projects but registered capital of USD The second form of investment is Joint Venture which had attracted 30 projects with total registered capital of nearly USD Phu Yen ranks the first destination having 8 projects with total registered capital of USD The second destination is Ninh Thuan, attracting 3 projects with total registered capital of USD Binh Duong with 11 projects and USD Despite the decline in , FDI inflows from India have generally been higher than before the signing of the Agreement.
India is a large market and expected to be one of the most powerful economies with numerous comparative advantages, a scientific and technological power, particularly in information technology. Meanwhile, Vietnam possesses abundant natural resources, industrious dynamics and well-educated labor force and is also a promising market. So the potential for bilateral cooperation is still vast and needed to be further exploited. In the memorandum of cooperation during the visit to India by President Tran Dai Quang in and the visit of the President of India in Vietnam in November , both leaders emphasized the prospects of long-term cooperation of the two countries between India and Vietnam as follows:.
Two countries establish to concrete plans to effectively implement the signed agreements in order to promote bilateral trade, including measures for trade promotion. The Vietnamese side welcomed and agreed to create faciltating conditions for Indian companies to invest into new thermal energy and renewable energy projects in Vietnam. Besides the opportunities, the two countries still face many challenges in bilateral trade cooperation such as:.
However, the two governments have created a favorable legal environment for businesses of both sides recently. Some of the documents are still overlapping, conflicting and lack of feasibility. Vietnamese enterprises, exporting to Indian market, are lack of understanding Indian market. For better implementation of their advantages, enterprises need to step up market research, timely grasp the needs and tastes of consumers, innovate designs and packages, and give competitive strategies on prices, application of scientific and technical advances in farming, agricultural and aquatic production, paying special attention to food hygiene and safety standards in order to improve the competitiveness of goods of the two countries.
Therefore, to improve the quality of trade promotion activities, the image building strategy and business investment environment of the two countries are extremely necessary.
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