09:03 | 01/10/2016 Cooperation
(VEN) - On the occasion of Indian Prime Minister (PM) Narendra Modi’s official visit to Vietnam from September 2-3, the two countries decided to upgrade bilateral relations to a comprehensive strategic partnership, affirming that Vietnam is an important pillar in India’s Act East policy, and opening new directions for bilateral cooperation in a wide range of fields, especially trade and investment.
Official ceremony to welcome Indian PM Narendra Modi at the Presidential Palace
Look East policy reiterated
At a joint press conference following talks with his Vietnamese counterpart Nguyen Xuan Phuc, PM Modi emphasized, “Our decision to upgrade our strategic partnership to a comprehensive strategic partnership captures the intent and path of our future cooperation. It will provide a new direction, momentum and substance to our bilateral cooperation.” The upgrade of bilateral ties aims to meet the aspirations of the two countries’ leaders and peoples, and to be in conformity with both sides’ fundamental and long-term interests, as well as their willingness to contribute to peace, stability, cooperation and development in the region and the world.
The two leaders agreed to increase bilateral economic, trade and investment cooperation as a strategic pillar of Vietnam-India relations. To achieve the US$15 billion bilateral trade target set for 2020, they requested their ministries and sectors to take specific drastic measures to create a favorable business and investment environment.
PM Phuc affirmed Vietnam welcomes Indian investment in oil and gas, energy, infrastructure, information technology, agriculture, and industry. Vietnam pledged to give priority to cooperation between the two countries in important fields such as civil uses of atomic energy, information technology, science and technology, culture, tourism, trade and investment, while increasing connectivity by air, water, and land. India pledged to provide US$5 million to help Vietnam build a software park in the city of Nha Trang.
The two leaders discussed measures to concretize and further expand cooperation in important fields such as energy, oil and gas, information technology, science and technology, education, healthcare, culture, tourism, and people-to-people exchange. They also laid stress on the potential and significance of agricultural cooperation between the two countries.
Increasing trade, investment
Vietnam and India have become each other’s important trading partners, with bilateral trade reaching US$5 billion last year. India currently is Vietnam’s 15th largest export market and 10th largest import market. Statistics from the General Department of Vietnam Customs show that bilateral trade reached US$2.97 billion in the first seven months of this year, including nearly US$1.47 billion worth of Vietnamese imports from India, and US$1.5 billion worth of exports to this market. A new target of bileteral trade has been recently set at US$15 billion by 2020.
With 118 investment projects ongoing in Vietnam with total registered capital of US$590 million, India currently ranks 28th among 110 countries and territories investing in Vietnam. Indian businesses have shown great interest in the Vietnamese market. The Tata Group is developing a US$2 billion investment project in Vietnam, while many other large auto industry and software groups continue to expand operations in the country. The Indian government has supported Indian businesses’ efforts to penetrate the Vietnamese market.
PM Modi expressed high interest of his government in increasing investment in Vietnam through major infrastructure projects such as Long Phu II Thermoelectric Plant with capacity of 1,320MW with estimated investment of US$2.2 billion from the Tata Group.
India also welcomes Vietnamese businesses as investors in the country and offers them opportunities to participate in the Make in India initiative. “We especially want to invite Vietnamese businesses to invest in the northeastern region of India. We determine the objective of promoting the connectivity between this region and ASEAN. I have announced a US$1 billion credit package to fund infrastructure and digital connectivity projects between India and ASEAN,” PM Modi said.
During the visit, the two sides signed 12 cooperation documents, including a protocol amending the agreement for avoidance of double taxation, a protocol between the two ministries of foreign affairs regarding activities to celebrate 2017 as the Year of Friendship, and a memorandum of understanding on information technology cooperation.
Vietnamese Deputy Minister of Finance Do Hoang Anh Tuan (sitting on the right) and Indian PM Narendra Modi sign a protocol amending the Agreement for Avoidance of Double Taxation
PM Modi announced a new US$500 million credit line for deepening bilateral defense cooperation. The two sides also signed an agreement on the construction of four offshore patrol boats for the Vietnam Marine Police.
Narendra Modi was the first Indian prime minister to visit Vietnam in the past 15 years. The visit was a significant event in the context of Vietnam and India looking towards the 45th anniversary of bilateral diplomatic relations on January 7, 2017 and 10 years of the strategic partnership.