Vietnam’s Association of Foreign Invested Enterprises (VAFIE), with its functions and missions, is always willing to accompany Indian companies in their process of exploring investment opportunities in Vietnam, said Dr. Nguyen Anh Tuan, the association’s standing vice chairman.
Vietnam-India economic ties thriving
Speaking at the Vietnam-India Economic and Cultural Exchange Forum in New Delhi on Thursday, Dr. Tuan, also Editor-in-Chief of The Investor, said that the Vietnam-India relationship, derived from religious and cultural exchanges more than 2,000 years ago, and further built and nurtured by late Vietnamese President Ho Chi Minh and late Indian Prime Minister Jawaharlal Nehru, has been developing continually over the past seven decades.
“The two countries set up their diplomatic relations in 1972, more than 50 years ago, and the traditional friendship relationship has grown in a strong and sustainable manner,” he said.
Since 1992, in line with Vietnam’s Doi moi (reform) policy and India’s “Look East” policy, the two countries have built extensive economic relations in many fields, especially oil and gas exploration, agriculture, and manufacturing. In 1997, Vietnam and India signed an Investment Promotion and Protection Agreement. In 2007, the two countries established a strategic partnership, which was upgraded to a comprehensive strategic partnership in 2016, creating an important premise for further propelling bilateral economic and investment relations.
Tuan said that India now has 321 investment projects in Vietnam with total registered capital of more than $1 billion, focusing on industries such as processing and manufacturing (60 projects worth $540 million in total), electricity generation and distribution (six projects worth $236 million), and mining (five projects worth $96 million). Major India-invested projects operating in Vietnam include the $94-million Son Hoa Sugar Factory in the south-central province of Phu Yen, an instant coffee factory worth $80 million, and the $72 million INFRA 1 Solar Power Plant in the south-central province of Ninh Thuan.
Meanwhile, Vietnamese businesses have six investment projects in India which are mostly small-sized, with a total investment of over $6 million in trade and services, he said.
Bilateral trade has increased 60 times, from $200 million in 2000 to almost $12 billion in 2019. Despite the Covid-19 pandemic, two-way trade exceeded $11 billion in 2022.
However, Tuan noted many experts shared the view that this encouraging trade and investment growth is still behind the potential of the two countries and their comprehensive strategic partnership.
VAFIA accompanies Indian investors
According to the VAFIE representative, over the years, the association has made substantial contributions to promoting the Vietnam-India economic ties.
In February 2022, VAFIE signed a memorandum of understanding (MoU) with the Indian Small Business & Franchise Association, or ISFA, on cooperation in promoting investment and trade.
In the same year, it signed an MoU with the Bombay Chamber of Commerce and Industry (BCCI) to promote trade exchanges and cooperation between companies of the two countries; signed another MoU with the India-Vietnam Chamber of Commerce and Industry (IVCCI) to exchange trade and investment information, support business missions from the two countries, and promote cooperation in green energy development, agricultural products and food, Tuan said.
The association also signed an MoU with the Indian Importers Chambers of Commerce and Industries (IICCI) to support and promote trade and investment in textiles and garments, electronics, pharmaceuticals, ports and marine shipping, he addded.
Carrying out these MoUs, VAFIE has coordinated with the Embassy of India in Hanoi to organize some workshops like a workshop in October 2020 for businesses of the two countries to cooperate in information technology and smart city development; a workshop in January 2021 on trade and investment promotion in the pharmaceutical sector; and an electronics forum in June 2022.
VAFIE and the Indian Embassy have also co-organized a networking event for a business mission of the Automotive Component Manufacturers Association of India (ACMA) with Vietnamese carmakers.
Its leaders have also welcomed and worked with many Indian business executives visiting Vietnam to sound out investment opportunities.
“VAFIE’s media entity Nha dau tu magazine and its sister English-language business publication Theinvestor.vn regularly cover economic, investment and trade issues between Vietnam and India,” Dr. Tuan noted.
The VAFIE vice chairman highlighted that the FDI sector is an important part of the Vietnamese economy and its long-term development is encouraged by the Vietnamese government. The Vietnamese government welcomes foreign corporations, including Indian enterprises, to invest in high technology, renewable energy, processing industries, manufacturing, infrastructure development, environmentally friendly projects.
“We believe that there are still huge potential and opportunities for investment and trade cooperation between Vietnam and India. As a politically stable country, Vietnam is among Southeast Asia’s fastest-growing economies and offers abundant young workforce and rich mineral resources, together with a favorable geographical position for economic cooperation and exchanges,” he stressed.
Vietnam has up to 15 FTAs with countries and regions in force, and is an active and responsible member of ASEAN that can serve as a base for India’s “Act East” policy. Meanwhile, India boasts advanced technology in many fields and a large market of 1.5 billion people. In addition, many Indian corporations are strong in financial potential.
Vietnam and India have already had strong political ties and sustainable friendship, which are further strengthened by the comprehensive strategic partnership. They are very important conditions for the two countries to bring their economic relations to a new height.
Tuan expressed his firm belief in the development of the comprehensive cooperation between the two countries in general and investment ties in particular.
“To further promote bilateral investment and trade relations, it is necessary to strengthen exchanges and networking; and to further promote investment, trade and services to enhance mutual understanding,” he noted.
At the forum, the VAFIE standing vice chairman was awarded the title of Asia-Pacific Outstanding Manager/Intellectual by the Vietnam Federation of UNESCO Associations and the Global Trade and Technology Council of India (GTTC India).
Also within the framework of the event, Tuan had discussions with Indian business associations, corporations and companies about potential and opportunities for investment cooperation between the two countries.