| Article Index |
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| India-Vietnam Economic and Commercial Relations |
| Bilateral trade and Economic Relations |
| Recent Business Delgations- From India |
| Recent Business Delegations - From Vietnam |
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Background
India supported Vietnam's independence from France, opposed U.S. involvement in the the war and supported unification of Vietnam. India established official diplomatic relations in 1972 and maintained friendly relations, especially in wake of Vietnam's hostile relations with the People's Republic of China, which had become India's strategic rival.
Development of bilateral and commercial ties
India granted the "Most Favoured Nation" status to Vietnam in 1975 and both nations signed a bilateral trade agreement in 1978 and the Bilateral Investment Promotion and Protection Agreement (BIPPA) on March 8, 1997. The Indo-Vietnam Joint Business Council has worked to promote trade and investment since 1993. In 2003, both nations promulgated a Joint Declaration on Comprehensive Cooperation when the General Secretary of the Communist Party of Vietnam Nong Duc Manh visited India and both nations are negotiating a free trade agreement. In 2007, a fresh joint declaration was issued during the state visit of the Prime Minister of Vietnam Nguyen Tan Dung. Bilateral trade has increased rapidly since the liberalisation of the economies of both Vietnam and India. India is the 13th largest exporter to Vietnam, with exports have grown steadily from USD 11.5 million in 1985-86 to USD 395.68 million by 2003. Vietnam's exports to India rose to USD 180 million, including agricultural products, handicrafts, textiles, electronics and other goods. Between 2001 and 2006, the volume of bilateral trade expanded at 20-30% per annum to reach USD 1 billion by 2006. Continuing the rapid pace of growth, bilateral trade rose to USD 2.48 billion in the year 2008, 2 years ahead of the official target of reaching USD 2 Billion by 2008. India and Vietnam have also expanded cooperation in information technology, education and collaboration of the respective national space programmes.
Strategic cooperation
India and Vietnam are members of the Mekong-Ganga Cooperation, created to develop to enhance close ties between India and nations of Southeast Asia. Vietnam has supported India's bid to become a permanent member of the U.N. Security Council and join the Asia-Pacific Economic Cooperation (APEC). In the 2003 joint declaration, India and Vietnam envisaged creating an "Arc of Advantage and Prosperity" in Southeast Asia; to this end, Vietnam has backed a more important relationship and role between India and the Association of Southeast Asian Nations (ASEAN) and its negotiation of an Indo-ASEAN free trade agreement. India and Vietnam have also built strategic partnerships, including extensive cooperation on developing atomic energy, enhancing regional security and fighting terrorism, transnational crime and drug trafficking.
Vietnam and India have close and friendly ties which encompass the entire range of political, economic, social and cultural relations with multi-faceted economic and commercial co-operation and substantial exchanges in the field of science & technology and human resource development. The two countries have entered into Agreements on Trade and Economic Co-operation, Avoidance of Double Taxation, Bilateral Investment Promotion and for Co-operation in Science & Technology. They also have mechanisms for reviewing trade and economic co-operation through the Bilateral Joint Commission, Joint Working Group and Joint Business Council. The leaders of the two countries agree that the traditional close political relations can be further strengthened through expansion and intensification of economic interaction in trade and investment for which there is considerable scope.
