India, Vietnam realize strategic partnership

09:15 | 14/02/2016 Cooperation

(VEN) - More than US$4.69 billion in trade turnover was a clear evidence for effective cooperation between India and Vietnam in 2015. Indian Ambassador to Vietnam Shrimati Preeti Seran talked about economic cooperation between the two countries in an interview with Vietnam Economic News’ Nguyen Phuong.

India, Vietnam realize strategic partnership

How do you assess cooperation potential between the two countries in the garment and textile sector?

There is immense potential for doing business between India and Vietnam in the garment and textile sector. Vietnam is one of the largest garment and textile exporters in the world today. We expect that with the implementation of the Trans-Pacific Partnership (TPP), Vietnam’s position will become even stronger.

India, on the other hand, is the huge market and source for producing raw materials that are required for Vietnam’s garment and textile sector. For example, we are the largest producer and the cheapest provider of cotton, silk, yarn, fabric, fiber and textile.

India is also a large provider of engineering goods and machines. We produce machines and tools which are competitive in quality as good as international standards but in price much cheaper. We feel that there is potential where Vietnam can import more machines and tools from India.

How do Indian businesses assess advantages and difficulties in doing business in Vietnam?

Large experience of Indian companies doing business in Vietnam has been very good and they are very satisfied with facilitation provided by the government, agencies and their clients in Vietnam.

Vietnam could overcome difficulties in getting visa, particularly business visa and work permit visa as it will encourage more Indian businesses to invest in Vietnam and do business. Allowing Indian banks to have commercial operations in Vietnam and opening direct flights between the two countries are vital.

Bilateral trade has recorded good growth but it seems to be lagged behind potential. Are tariff reduction commitments in the ASEAN-India Free Trade Agreement not strong enough? Should the two countries come to a bilateral agreement?

The ASEAN-India Free Trade Agreement has been helpful but not realized the full potential of our bilateral trade. Indian businesses have found that there are several tariff barriers, and then it’s not fair. Examples are in pharmaceutical products, textile raw materials and machines. The tariffs that are imposed on Indian goods are much higher than what is imposed on other trading partners of Vietnam. And therefore, there is not fair for Indian businesses. They cannot buy although they offer competitive goods at competitive prices because the tariffs are so much higher. We hope that maybe there is a review in its agreement or the negotiations of the Regional Comprehensive Economic Partnership (RCEP) move faster. And I would image that between these two, if we can come to a solution, it will be very helpful.

What should the two countries do to promote economic, trade and investment cooperation in the coming time?

In addition to direct shipping, direct flights, better visa facilitation I think that what we need to do is create more awareness about each other’s potential. I think we need to organize more trade fairs. Although bilateral trade has recorded good growth and the two countries have gone ahead of its trade targets, there is a lot of potential.

We have identified four or five important sectors as priority including pharmaceutical industry, agriculture and agro-processing, engineering goods, information technology and garments and textiles. In fact, our prime minister agreed that economic cooperation should become strategic priority between the two countries.