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Vietnam: Time to consolidate ties

Vietnam is on the Indian radar for two reasons. First, April 30 marked the 25th anniversary of American capitulation at Saigon. Second, India's belated bid for a strategic partnership with Vietnam. Until last month India-Vietnam relations, though going as far back as 1954 (historic relations are rooted in a Hindu Kingdom in central Vietnam nearly 2000 years ago), had lacked a strategic and economic content despite the shared experience of colonisation and protracted wars (including one by China against Vietnam as late as 1979).

Defence Minister George Fernandes initiated the much-needed correction by upgrading the protocol on defence agreement signed by P V Narasimha Rao in 1994 to a strategic dimension with economic underpinnings. Of course, this is easier said than done but is still worth attempting. The distance of geography and mutual neglect have retarded a more fruitful relationship.

So far, the defence dialogue was restricted to the military - intelligence sharing the key element in it. Because of the constraints of language (and funds, in the case of Vietnam), a post Pokhran-II special relationship has not flowered. On its part, after the reunification in 1975 and economic turnaround from a centrally planned economy to a free market system called Doi Moi in 1986, Vietnam has not looked back, even weathering the recent East Asian financial crisis.

A country that has fought wars for centuries including three with France, America and China between 1953 and 1979, the priority is clear, economic reconstruction. India could become a modest partner in this and swing it around to mutual benefit. The strategic factor is relevant but Vietnam is wary of acknowledging this for fear of ruffling Chinese feathers.

China and Vietnam share a 1,200-km-long land border. The border dispute has been defused and a border agreement is to be signed later this year though the maritime boundary and a territorial dispute in the Gulf of Tonkin and the South China Sea have been put on hold to be resolved by mutual negotiations.

India's nuclear tests only privately lauded by the Vietnamese were seen as a counterweight to China. They were, however, more vocal in their support during Kargil. Vietnam was consistently vocal in its support during Kargil. Vietnam has consistently supported India's membership of the UN Security Council and on other issues in regional and international fora. Vietnamese have not forgotten how India stood by them during their long but successful struggle against US military fight.

Vietnam is indeed interested in discreetly adding a strategic note to the existing relations owing to its need to sanitise the sea lanes from the scourge of piracy which is rampant in this region. An agreement for cooperation between the navies, sea police and coast guards of the two countries has been reached. Japan, which now regards China as its principal threat, could also be brought into this safety net in a regional policing arrangement with India and Vietnam. 90 per cent of Japan's oil comes from the Gulf and passes through the Indian Ocean and the troubled South China Sea.

Of the 167 countries with which Vietnam has diplomatic relations, military ties are with just 30. The US which is nailed through Vietnam's war museums as the perpetrator of horrendous war crimes against its people, has been keen to engage it militarily too after full diplomatic relations were re-established in 1995. Their present ambassador is a former PoW who was jailed for four years in Hanoi. The Americans have made modest proposals in sharing military expertise but Vietnam has politely declined the offer saying it is not ready for it. The current interest of the US is to continue drawing cooperation in tracing the 2000 servicemen still missing in action in Vietnam. US Defence Secretary William Cohen visited Vietnam a week before George Fernandes but was not taken to some of the military installations that Fernandes was.

How can India and Vietnam cooperate in the defence field? Fernandes and his counterpart agreed for a periodic security dialogue, jointly combating the menace of piracy and co-operation in ship building and hydrographic survey. Vietnam expressed some interest in purchase of military equipment including the Advanced Light Helicopter and repair and overhaul of its MiG aircraft fleet. India has in fact offered to modernise the People's Army, currently plagued by shortages in spares and military hardware. The only catch is that Vietnam says it has no money for this as its priority is to rebuild the economy. Would India be prepared to underwrite this military assistance given its own constraint of funds?

Further, there is pessimism over the economic content of the relations. Like India, 60 per cent of the population of Vietnam is below 35. Until the east Asian meltdown, Vietnam's economy grew at around 9 per cent of the GDP and is presently levelled at 6 per cent. The 77 million predominantly Buddhist population has a per capita income similar to India's -- $ 345. In Saigon this figure is around $ 1000.

Total Foreign Direct Investment is of the order of $ 38 billion, while the volume of foreign trade is $ 20 billion. India's share is less than 1 per cent -- a measly $ 150 million. Vietnam's greatest asset is the literacy rate which is 97 per cent.

There is a small but strong Indian business community in Vietnam, especially in the commercial city of Saigon. Indian companies have invested in more than half a dozen joint or wholly-owned ventures amounting to just $ 200 million. Maximum investment potential lies in the oil and gas sectors. ONGC Videsh has discovered gas at Vung Tao in the South where an estimated 2 trillion cubic metres capacity exists.

India should join hands with Russia which is helping Vietnam to set up a $ 2 billion oil refinery in the central province. Russia has an obvious strategic stake in Vietnam after it took over Camranh Bay from the Americans in 1978 and bankrolled the country till a few years ago. The Russians lease of Camranh is to expire next year and it is not likely Russia will give up its static toe hold even while the US is on the prowl to find an alternative to the lost subic Bay in the Phillipines.

The new century belongs to the Asia Pacific. India-Vietnam relations can take off only if trade and commercial interests are dovetailed into a partnership of mutual benefit. The overlap in strategic interests and concerns of the two countries has not been fully realised by both sides and valuable time lost acknowledging this.

The author accompanied the defence minister to Vietnam last month.

General Ashok K Mehta