Despite China's objections to Indian investment in Vietnam's oil and gas sector, India and Vietnam are looking to scale up energy ties, while also strengthening defence and security cooperation. Ahead of PM Narendra Modi's virtual meeting with his counterpart Nguyen Xuan Phuc next week, Vietnam has said it's looking forward to oil and gas exploration company Essar Exploration ramping up its investment in the southeast Asian country to $11 billion.
The summit next week, in a sign of deepening defence ties, is also likely to coincide with the launch of the first high-speed patrol boat which L&T has built for Vietnam using the $100 million defence line of credit (LC) India announced earlier for the ASEAN country that remains locked in a territorial dispute with Beijing in South China Sea (SCS).
"Essar has expressed interest in scaling up their investment project in Vietnam to $11 billion. If that happens, the project will be the single biggest investment by an Indian company in Vietnam. We are looking forward to their decision and are very optimistic about it," said Vietnam ambassador to India Pham Sanh Chau. Essar and ONGC Videsh are the 2 major oil companies active in Vietnam at the moment.
Claiming sovereignty over almost the entire SCS with its controversial 9-dash claim line, China has repeatedly in the past expressed reservations about Vietnam's invitation to Indian companies for offshore oil exploration, saying that development of bilateral relations should not be used as an excuse to infringe upon China's "legitimate rights and interests" in the SCS.
Both India and Vietnam look at defence and security ties as one of the main pillars of their comprehensive strategic partnership. However, despite its disputes with China, Vietnam has been measured in its efforts to build defence ties with India. There was significant delay in operationalising a $ 500 million defence LC India had announced for Vietnam in 2016 as the latter wanted to use the same for infrastructure development instead of defence procurement. One of the reasons for the failure to sign a framework agreement during President Ram Nath Kovind's visit to Vietnam in 2018 was said to be Hanoi's efforts to improve ties with Beijing.
Speaking at an event to mark the 75th anniversary of Vietnam's National Day, the ambassador said the 2 countries were discussing "to materialise" the same LC. He described the procurement of patrol boats from India under the earlier $ 100 million LC as a "concrete example" of defence cooperation.
The Indian and Vietnamese PMs had recently co-chaired the 17th ASEAN-India Summit in which the two sides had articulated their shared interests in maintaining regional rules-based order centred upon ASEAN.
"The leaders reviewed the status of the ASEAN-India Strategic Partnership and take stock of progress made in key areas such as connectivity, maritime cooperation, trade and commerce, education and capacity building. Thanks to the support and collaboration of India, Vietnam finished the ASEAN chairmanship with multiple accomplishments. A record number of 80 agreements have been signed and approved," said ambassador Pham.
The ambassador described the upcoming summit meeting as very promising with dozens of likely deliverables in bilateral relations.
"Among them, we are delighted to announce that the two sides have decided on the sites for the bust of our late President Ho Chi Minh in New Delhi and the bust of legendary Mahatma Gandhi in Ho Chi Minh city in Vietnam. We do hope that such an important meeting will work out a vision and concrete plan to further strengthen our comprehensive strategic partnership," added the ambassador.
