There is scope to do better on trade and investment between India and Vietnam, Vice-President Hamid Ansari said, addressing correspondents on board the special aircraft returning from Ho Chi Minh City to New Delhi. He was on a four-day visit to Vietnam to participate in events marking the conclusion of 40 years of friendship and five years of strategic partnership between the two countries.
“Hopefully, there will be more activity on business … investment in Vietnam by Indian companies is modest in comparison to that made in the larger ASEAN community,” Mr. Ansari pointed out.
Earlier in the day, he expressed similar sentiment while addressing a reception hosted by Indian Ambassador Ranjit Rae where about 300 members of the 1,500-strong Indian community in Ho Chi Minh City were present.
Indian businessmen and company representatives from a host of sectors such as pharmaceuticals, health care, banking, general trading and coffee processing attended the reception.
Indian companies such as Godrej (furniture), Nagarjuna and KCP (sugar), Phillips Carbon Black, Marico, Fortis Health Care and CCL (coffee) have invested in Vietnam but none of these are big.
Major pharmaceutical firms such as Torrent, Zydus Cadila, Glenmark and Panacea Biotech have also set up offices to promote their products in Vietnam. Incidentally, India is one of the largest exporters of pharmaceutical products to Vietnam.
Lack of awareness and consciousness in Vietnam of India as a business partner seems to be a stumbling block to better trade relations, according to an official in the Indian delegation. With ASEAN, Taiwan, Korea and Japan showering attention on Vietnam, and China offering attractive loans for projects using Chinese equipment, the disinterest in India as a partner is probably understandable, said the official.
Tata Steel was planning a big investment in setting up a steel plant in the country but it is now on the backburner, if not given up already, as the company could not secure the right incentives from the Vietnamese government.
No direct flight
The absence of a direct flight between the two countries is a dampener to not just business but also tourism. Given that most Vietnamese are Buddhists, there is potential to leverage the Buddhist tourism circuit in India but without a direct flight, it is a non-starter, said an official.
Mr. Ansari referred to this in his media interaction. “Direct flights are a work-in-progress and I don’t know when they will begin. But when they do, they will give a boost to tourism,” he said.
Trade between the two countries stands at around $4 billion and the aim is to take it to $7 billion by 2015.