For Vietnam, India can be a reliable partner

At the recently concluded Asia Agri Food Conference in Ho Chi Min City, several ideas to cement India Vietnam partnership in the area of agriculture and agribusiness came to the fore.

The remarkable growth in goods trade between India and Vietnam over the last two decades is worth noting. Vietnam’s impressive strides in the field of electronics is of course well recognized.

The trade structure of the two countries is actually complementary. While Vietnam exports industrial, high tech goods, India’s exports comprise raw material, agricultural goods and some manufactured goods.

From about US$ 200 million in early 2000, the value of bilateral trade increased to $ 15 billion by 2024.

Valued at about $ 9.0 billion and up 7.6 percent year-on year, Vietnam’s exports to India comprise mobile phones, computers, electronic products, machinery, equipment, tools, spare parts, telecom instruments, consumer electronics, processed minerals, timber, wood products, rubber, coffee, cashew, seafood etc.

India’s exports to Vietnam were valued at $ 5.83 billion in 2024, down 0.6 percent year-on-year. Shipments comprised bovine meat, marine products, cotton, cereals, auto components, pharmaceuticals as well as iron and steel. .

Currently, Vietnam enjoys a trade surplus of over $ 3 billion with India. The long-term goal targets goods trade between the two countries to reach $ 20 billion by 2030. This target is eminently achievable and can even exceed by building partnerships.

It is in this context that the India-Vietnam Business Meeting held in New Delhi in March 2025 assumes importance. The meeting saw enormous interest to enhance trade and investment. The focus areas covered included agriculture, IT, AI and robotics.

Indeed Vietnam is an attractive destination for Indian investment. The areas include energy, mineral exploration, agro-processing, IT and auto components. Indian companies are exploring opportunities in renewable energy and port development in Vietnam.

Importantly, Vietnam’s stable political environment, favourable demographics and strategic location along major shipping routes makes it a promising partner for India.

For Vietnam, India’s large and growing middleclass and its customs duty exemptions for ASEAN products offer big scope for Vietnamese export.

As two rapidly growing Asian economies, India and Vietnam must build enduring partnership for sustained growth in sustainable ways. Ideally, this partnership must stand on four pillars – Trade, Investment, joint Research and Technology exchange.

While trade is important, building a relationship based merely on trade would a transactional relationship. Such a relationship usually tends to be fragile and prone to disturbance for varied reasons including geopolitics. For sake of stability, the relationship must go well beyond trade. It must cover bilateral investment, joint research and tech exchange for mutual benefit.

This is particularly critical at the current juncture as Vietnam is among the Asian countries affected by Trump tariffs. While Vietnam is in talks with the US for an amicable resolution of the tariff tangle, China is an important trading partner from where Vietnam sources lot of inputs. This can potentially make it difficult for Vietnam to wrest concessions from the US. This has created a dilemma and in a manner of speaking Vietnam finds itself sandwiched between the US and China.

It is in this situation that Vietnam needs reliable allies. India can be one.

To meet its growing feed needs, Vietnam imports over five million tons of wheat and about 13 million tons of coarse grains mainly corn / maize. Cotton consumption too is rising with imports recorded at over 7 million bales. India has an opportunity to maximize its cotton and wheat export to Vietnam. It can help reduce the existing trade deficit.

The writer was the keynote speaker at the Asia Agri Food Conference in Ho Chi Min City May 26-27, 2025 with Indian Consul General as Chief Guest. Over 200 delegates representing the agri value chain in South Asia and Southeast Asia participated.