Rajeev Garg, the chairman of the Indian Chamber of Commerce (INCHAM) stated the bilateral trade between India and Vietnam was expected to be well over $2bn by this year end. In 1997, two-way trade between the two countries had been a paltry $114mn but within a decade it was able to achieve in excess of staggering $2bn.
While the two parties signed the Declaration on Strategic Partnership in 2007, the target set for 2010 was $2bn. The two countries have already exceeded the target by 50 percent and achieved it with two more years to spare. Despite global meltdown, the trade between the two is expected to cross $3bn in 2009.
Garg said the scope of augmenting the business opportunities for both nations was immense provided there were business exchanges and conferences between the two at regular intervals. There are some glitches here and there to reach higher levels in bilateral trade, and among them, the major impediment was stated as there were no direct flights between India and Vietnam.
Indian investments in Vietnam are in varied fields including IT, mining, steel, sugar, transmission towers, office furniture, plastics, pharmaceuticals apart from oil and gas. India’s investments in various businesses have put them as the sixth largest investor in 2007 of Vietnam. On the contrary, Vietnam largely focused on the exports of fine handicrafts, footwear, textiles and garments, furniture and electronic components besides agro and aqua products.
Prime Minister Nguyen Tan Dung’s visit to India last year brought huge capital inflow from India to Vietnam. These relations are further strengthened through the recent visit by the President of India, Pratibha Patil. Though there is huge trade gap in favour of India with exports in 2007 at $1.356 billion and Vietnam’s at $0.18 billion, the India-ASEAN Trade in Goods Agreement is expected to ensure faster growth and balance.