Trade - a pillar of cooperation in Vietnam - India relations
Vietnam and India established diplomatic relations in 1973 and upgraded them to a comprehensive strategic partnership in 2016. In recent years, Vietnam - India comprehensive strategic partnership has made important developments in many fields, in which business communities of the two countries have played an important role in promoting bilateral economic cooperation.
Assessing bilateral cooperation between Vietnam and India, Indian Ambassador to Vietnam Sandeep Arya affirmed that comprehensive strategic partnership between Vietnam and India has recorded strong progress with many notable achievements in 2023, laying foundation for cooperative activities in 2024 and the following years.
According to the Ambassador, Vietnam and India have much potential to expand cooperation and promote growth in fields of agriculture and fishery; production of electricity, electronics, chemicals and pharmaceuticals; mineral processing; energy; infrastructure development; transportation and tourism services. Two sides have been discussing to establish a framework and coordination mechanism to promote trade cooperation in these areas. Not only that, the two countries also have much room to expand cooperation in other fields such as banking, digital payments and direct transportation services.
Sharing same opinion, Vietnam Trade Office in India also believes that trade is an important pillar in bilateral relationship between Vietnam and India, continuously achieving steady growth over the past 20 years. Bilateral relations from about 200 million USD in 2000 have reached 15 billion USD in 2022, making India one of Vietnam's top 8 trading partners, while Vietnam is in the top 4 ASEAN countries with trade relations with India.
Notably, in recent years, structure of import and export products of the two countries has been balanced and complementary. While India is an important source of raw materials and finished products for Vietnam for iron and steel, chemicals, pharmaceuticals, textiles, animal feed, and seafood, the top export product group from Vietnam to India is personal computers; mobile phones and components, iron and steel, chemicals, wood and wood products, shoes, spices, coffee, pepper...
In 2023, according to statistics from General Department of Customs, export turnover of Vietnamese goods to India in December reached 702.5 million USD, down 3.6% compared to the previous month. Overall, Vietnam's export turnover to India in 2023 reached more than 8.49 billion USD, up 6.7% over the same period last year. With this data, India is one of the few markets achieving positive growth.
Leading the way is group of computers, electronic products and components with 1.94 billion USD, an increase of 88.2% over the same period last year, accounting for 22.9% of the proportion. The next is group of all kinds of phones and components reaching 1.03 billion, accounting for 12.2% proportion. In 2023, export turnover of some product groups increase compared to the same period last year: Iron and steel of all kinds increased by 319.3%; Wood and wood products increased by 287.3%; rubber products increased by 65.7%.
Exporting goods to Indian market in 2024 still opens up opportunities for Vietnamese businesses, when consumer demand in the market of 1.4 billion people gradually recovers and regains growth momentum after the pandemic.
Opportunity for export breakthrough into India?
At the 5th Meeting of Vietnam-India Joint Trade Subcommittee held in August 2023, Deputy Minister of Industry and Trade Phan Thi Thang said that two sides need to exploit elements of mutual complementarity in commodity structure, ensuring uninterrupted supply and production chains for each side's strong product groups such as textiles and garments, footwear, processed agricultural and aquatic products, industrial goods, and household food livestock, chemicals and plastics, pharmaceuticals, electronic components...
Besides, according to Deputy Minister, the two countries need to remove trade barriers for each other's import and export goods; promote market opening for each side's strengths, especially agricultural products and fresh fruits; along with promoting cooperation in the field of e-commerce; Strengthening business and tourism trade connections through promoting the operation of more direct flights and increasing the frequency of flight operations between major cities of the two countries.
Looking at export structure and export growth in recent times, we can see that in Vietnam, the industry group producing phones, agricultural products, iron and steel... has many opportunities to boost exports to Vietnam. India.
First of all, for agricultural products industry. Coffee is currently an important export product of Vietnam to India. Indian people love Vietnamese instant coffee. Besides L'amant, the brands Trung Nguyen and G7 have also developed very well in India. The two governments are still negotiating to reduce import taxes, then Vietnamese coffee will have a strong presence in India.
In addition, cinnamon is also Vietnam's main export product to this market. Currently, Vietnam's cinnamon exports to India account for about 80% of the market's cinnamon import demand. According to Indian data, in the 2022-2023 fiscal year, India imported 38,000 tons, while from Vietnam it was 35,000 tons. "Cinnamon or spices are almost exclusively Vietnamese products in India. Therefore, businesses should promote trade promotion solutions and thoroughly learn about the market to increase export value" - Mr. Bui Trung Thuong recommended.
Second, exporting all kinds of phone products and components. As reported above, in 2024, export turnover of all types of phones and components to India will reach 1.03 billion, accounting for 12.2% of the proportion. Although it has only been exported to India since 2009, phone products of all types and components have become the items with the largest turnover exported to this market.
Third, Vietnam's steel and steel product manufacturing industry has the opportunity to boost exports to India when in 2023, iron and steel exports to India increase by 319.3% over the same period in 2022.
Although it is considered a potential market, Mr. Bui Trung Thuong - Commercial Counselor, Vietnam Trade Office in India said that exporting to Indian market is not easy because in context of Indian exports When faced with difficulties, this market will also find ways to protect the domestic market and create jobs for businesses and workers. Therefore, to penetrate deeper into this market, Mr. Bui Trung Thuong said that trade promotion work will have to be improved and combine diverse forms.
The deal to encourage Vietnamese businesses to export to India needs to create an ecosystem in the Indian market. In addition, India's e-commerce is currently about 10 years behind Vietnam's. However, this gap will be erased very quickly, so it is very appropriate for businesses to approach the market at this time.

Source: Vitic/ congthuong.vn