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Development Of Vietnam - India Economic- Trade Relations: The Barriers And Outlook (Part 1)

18/03/2016


Development Of Vietnam - India Economic- Trade  Relations: The Barriers And Outlook (Part 1)

The Vietnam-India joint declaration on strategic partnership, which was signed by Prime Ministers of the two countries during Prime Minister Nguyen Tan Dung’s state visit to India in May 7th 2007, has brought Vietnam-India relations to the highest level. Relationship strategic partnership allows both sides to expand and promote all areas of cooperation, from economic, trade and investment to security, defense, science and education, culture, tourism and agriculture. Economic and trade relations are identified by the two governments as one of the key pillars of Vietnam–India strategic partnership relations.


Development Of Vietnam - India Economic- Trade  Relations: The Barriers And Outlook

  Do Thang Hai* 

Vietnam and India have traditional and long-standing ties of friendship which have been continuously nurtured and taken to next level by the generations of leaders of the two countries. In 1950s, Vietnamese President Ho Chi Minh and Indian Prime Minister Nehru Jawaharla emphasized faithful friendship of the two nations. Since 1990s, there have been many profound changes in the international context with the end of the Cold War and globalization. Bilateral relation, that was mainly political, has now been expanded and developed in the fields of politics, economy, culture, education, security and defense. Important factors promoting the expansion of bilateral relations in this period come from the interests of each country in the process of implementing opening-up policy, economic integration. As for Vietnam, it is the Renovation (Doi Moi) from 1986 and for India it is "Look East policy" since 1991.

Entering the XXI century, bilateral relations were brought to higher level with Joint Declaration on the Framework of Comprehensive Cooperation between the Republic of India and the Socialist Republic of Vietnam as they enter the 21st Century signed during a visit of Vietnam Communist Party’s General Secretary Nong Duc Manh to India in May 2003. The Vietnam-India joint declaration on strategic partnership, which was signed by Prime Ministers of the two countries during Prime Minister Nguyen Tan Dung’s state visit to India in May 7th 2007, has brought Vietnam-India relations to the highest level.

Relationship strategic partnership allows both sides to expand and promote all areas of cooperation, from economic, trade and investment to security, defense, science and education, culture, tourism and agriculture. Economic and trade relations are identified by the two governments as one of the key pillars of Vietnam–India strategic partnership relations. This is an important event marking a new step in relations between the two countries at the macro level, paving the way for broad-based development of bilateral relations in all fields. Currently, Vietnam is one of the top priority partners in the "Look East policy" of India. India is one of the most important economic partners of Vietnam in the South Asia region.

I. TRADE RELATIONS VIETNAM ECONOMY - INDIA

1. Trade relations

 In recent years, bilateral trade relation is constantly growing. Two-way trade turnover increased from US $ 2.48 billion in 2008 to US $ 5.59 billion in 2014.

The export turnover of Vietnam-India from 2008 to 2014

Unit: USD million 

Turnover

2008

2009

2010

2011

2012

2013

2014

Exports to India

389

420

993

1.553

1.782

2.355

2.460

Imports from India

2.094

1.635

1.746

2.347

2.161

2.834

3.130

Two-way trade

2.483

2.055

2.739

3.900

3.943

5.089

5.590

Trade balance

-1.705

-1.215

-753

-794

-379

-479

-670

Source: Vietnam General Department of Customs

 In 2014, export turnover of Vietnam to India reached US $ 2.46 billion. India has always been the largest export market of Vietnam in the South Asia region. The export structure has shifted from agricultural products and raw materials into industrial products, consumer products and high value added products. Currently, Vietnam goods exports to India include phones and accessories, machinery, tools, spare parts, computers, rubber, chemicals, coffee, pepper, yarn products, metal products, wood, footwear, seafood, textile...

Structure of Vietnam exports to India in 2014 

Unit: million USD 

No.  Items  Turnover
1 Mobile phone components and equipments 890
2 Equipments, tools and spare parts 226
3 Rubber 159
4 Computers, electronic products and components 153
5 Chemicals 97
6 Pepper 83
7 Coffe 77
8 Yarn 76
9 Metal products 59
10 Wood 55
11 Incense 55
12 Cinnamon 43

Source: Vietnam General Department of Customs

Deputy Minister of Industry and Trade of Vietnam

(Part 2)

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