A New Era for Vietnam-India Trade and Investment: Prime Minister Pham Minh Chinh Emphasizes Five Fundamental Pillars

The Forum was organized by the Ministry of Planning and Investment of Vietnam, the Embassy of Vietnam in India, and the Federation of Indian Chambers of Commerce and Industry. The event was attended by leaders of ministries and a large number of business representatives from both countries.

Businesses from both countries were introduced to the potential and opportunities for cooperation, and they exchanged plans and investment projects, as well as discussed challenges and made proposals to the relevant authorities of the two countries.

The opinions of the businesses and leaders from the Indian side highly appreciated the investment and business environment in Vietnam and expressed their impression of Vietnam’s great achievements, which have made the country a bright spot in the region in terms of socio-economic development.

Over the years, two-way trade between Vietnam and India has grown from $200 million in 2000 to $14.4 billion in 2023, with Vietnam’s exports to India reaching $8.5 billion and imports at $5.9 billion. India is one of Vietnam’s eight largest trade partners, while Vietnam is among the top four ASEAN countries in trade with India.

In terms of investment, India has 410 valid projects in Vietnam with a total registered capital of $1.03 billion, ranking 25th out of 146 countries and territories investing in Vietnam. Meanwhile, Vietnam has invested in 16 projects in India with a total investment of over $14 million.

Economic, Investment, and Trade Cooperation as a Bright Spot and Important Pillar

Speaking at the Forum, Prime Minister Pham Minh Chinh congratulated India on its great successes in rapid and comprehensive development and high economic growth under the leadership of the Government headed by Prime Minister Narendra Modi in recent years. He also expressed his gratitude to the Indian side for the warm and hospitable reception during his State visit to India.

The Prime Minister was impressed by the large number of business representatives from both countries attending the Forum, which demonstrated their interest, trust, and confidence in the potential for bilateral economic cooperation and Vietnam’s investment environment.

According to the Prime Minister, the history of Vietnam-India relations dates back to the cultural and religious exchanges that took place over 2,000 years ago and were further fostered by the two great leaders, President Ho Chi Minh and Mahatma Gandhi. The two countries have always supported and assisted each other in their struggles for national independence against foreign aggression.

Over the past five decades of diplomatic relations, the upgrade of bilateral relations to a Comprehensive Strategic Partnership has opened up new opportunities for cooperation in value chains and strategic resources, economic security, response to climate change, environment, science and technology, financial connectivity, and high-quality human resources, among others.

The Prime Minister assessed that economic, investment, and trade cooperation has become a bright spot and an important pillar in the bilateral relations. Vietnam is an important partner of India in its “Act East” policy.

The Prime Minister was impressed by the statement made by Prime Minister Narendra Modi on September 3, 2016, before the G20 Summit: “Vietnam is a strong pillar in India’s Act East policy” and “bilateral relations between the two countries are based on trust, understanding, and convergence of views on various regional and global issues.”

“Placing Vietnam in an important position as the ‘focus’ and ‘bridge’ in the ‘Act East’ policy has contributed to promoting Vietnam-India relations in general and economic relations in particular to a new height,” said the Prime Minister.

The Prime Minister noted that, in addition to the fundamental factor of the long-standing traditional friendship between the two countries and peoples, the support and attention of the two Governments, and the joint efforts of the business communities, the achievements in economic cooperation would not have been possible.

The Prime Minister highly appreciated and sincerely thanked the Indian businesses for their practical and effective contributions to Vietnam’s socio-economic development, which have nurtured the good relationship between Vietnam and India over the past 50 years.

Five Foundation Elements in Vietnam-India Relations

The Prime Minister emphasized that there are five very important foundation elements for the two countries’ businesses to continue cooperating with high trust, success, and efficiency, contributing to the bilateral relations. These elements include: traditional good friendship, high political trust, open markets, similar cultures and civilizations, and mutual understanding of ideas, as well as a shared aspiration to build strong, prosperous, and rapidly and sustainably developing countries.

The Head of the Government took time to analyze the foundation elements for development, as well as the major orientations in economics, foreign affairs, national defense and security, social welfare, culture, and the building of the political system of Vietnam.

After nearly 40 years of reform, Vietnam has become one of the 40 largest economies in the world, ranking among the top 20 in trade, and 32nd in the top 100 of the world’s strongest national brands. Vietnam has signed 16 FTAs with more than 60 countries.

Vietnam continues to implement synchronous solutions to improve the investment and business environment, enhance competitiveness, promote administrative reform, especially in cutting and simplifying administrative procedures, and focus on reviewing and perfecting mechanisms and policies to remove obstacles for production and business activities, creating favorable conditions for people and businesses.

Vietnam is promoting the implementation of three strategic breakthroughs (institutional improvement, infrastructure development, and human resource training) based on science and technology and innovation. At the same time, it is renewing traditional driving forces (investment, export, and consumption) and promoting new growth drivers (digital economy, green economy, circular economy, sharing economy, knowledge-based economy, and emerging fields such as semiconductors and artificial intelligence).

As a result, Vietnam’s investment and business environment has been constantly improving. In 2023, FDI attraction reached nearly $36.6 billion, up 32.1% compared to 2022, while FDI realization reached $23.2 billion, the highest ever.

The Prime Minister stated that Vietnam considers the foreign-invested economic sector to play an important role, with a focus on selective FDI attraction, creating connectivity and spillover effects between the FDI and domestic sectors, promoting public-private partnerships, and mobilizing all resources for development, with a strong emphasis on green, digital, circular, and knowledge-based economies.

Aiming for a Two-way Trade Target of $20 Billion

According to the Prime Minister, the Vietnamese Government encourages Indian businesses to expand investment cooperation in areas where India has strengths and Vietnam has high demand and priorities, such as high technology, electronics, science and technology, artificial intelligence (AI), infrastructure development, renewable energy, new energy (hydrogen), biotechnology, innovation, high-tech agriculture, pharmaceuticals, and so on.

Affirming that Vietnam considers the success of investors as its own success, the Prime Minister emphasized the spirit of “harmonious interests and shared risks,” “saying and doing,” “commitment and implementation,” “doing and producing concrete results and high efficiency,” “listening and understanding together,” “sharing vision and action,” “doing together, enjoying together, and winning together.”

The Prime Minister proposed that the two sides continue to support and promote investment dialogue and connectivity, create favorable conditions for businesses from both sides to expand effective cooperation, investment, and business activities, and implement effective measures to achieve the two-way trade target of $20 billion in the near future. He also suggested facilitating the access of more Vietnamese goods to the Indian market and opening more direct flights between the two countries.

Along with that, the Prime Minister called for continued enhancement of development cooperation (ODA), focusing on strategic infrastructure development, including transport infrastructure, energy infrastructure, digital infrastructure, and infrastructure for adaptation to climate change. He also emphasized the importance of close cooperation and mutual support in international and regional forums of common interest.

The Prime Minister requested Vietnamese ministries, sectors, and localities to strengthen dialogue to remove difficulties and obstacles for Indian investors in Vietnam, promptly report issues beyond their competence in accordance with the law, continue to review and reform administrative procedures, cut and simplify administrative procedures, promote the application of digital technology, decentralize and delegate powers, reduce compliance costs and input costs for people and businesses, and prepare conditions to attract investment in transport infrastructure, human resources, power supply, clean land funds, and establish inter-sectoral working groups to remove obstacles and support investors.

The Prime Minister proposed that Indian corporations and businesses continue to invest and expand their investment in Vietnam, cooperate in training high-quality human resources, especially in the fields of semiconductors, science and technology, innovation, digital transformation, green transition (hydrogen), pharmaceuticals (especially vaccines and drugs for treating incurable diseases), renewable energy, and biotechnology.

At the same time, the Prime Minister expressed his hope that Indian businesses and investors would support and facilitate Vietnamese businesses to participate in the value chains of Indian corporations, especially in areas where Vietnam has potential, and consider Vietnam as a strategic destination for establishing research and development (R&D) centers and applying high technology.

He also suggested that they regularly provide recommendations and advice to the Governments, ministries, sectors, and localities of the two countries to remove obstacles in the production and business process and improve the institutional and policy environment to enhance the investment and business environment.

With high determination and great efforts from both sides, and on the foundation of the traditional friendship and Comprehensive Strategic Partnership between Vietnam and India, the Prime Minister expressed his belief that economic, investment, and trade cooperation will continue to be an important pillar in the bilateral relations, contributing to taking the relationship between the two countries to new heights, bearing more fruits and yielding greater benefits.

Also at the Forum, the Prime Minister and the delegates attended the announcement of the Da Nang (Vietnam) – Ahmedabad (Gujarat, India) air route and welcomed Vietjet airline’s 200 millionth passenger.

The Prime Minister also witnessed the signing of Memorandums of Understanding between businesses of the two countries, including the MoU between Sovico Group and Adani Group on cooperation in aviation, airports, and logistics, the MoU