International Conference on India-Vietnam Relations in the Changing Geo-Politics of the Indo-Pacific, The India International Centre, New Delhi, 9 January 2018

Keynote Address by Dr. Arvind Gupta, Director VIF

I would like to thank the South Asia Research Group, Delhi University, Amb. Ton Sinh Thanh, Prof. Chintamani Mahapatra, Amb. Nalin Surie, panellists, the Department of Political Science Delhi University and Dr. Sonu Trivedi of Zakir Hussain Delhi College for organizing this conference and inviting me for this session.

Dr. Trivedi and her team have organized several conferences on India’s relations with ASEAN countries. She herself has been involved in the furthering of academic level contacts between India and Vietnam for several years. I am impressed with the enthusiasm with which they are advancing academic contacts between India and Vietnam.

I had the honour of being a part of an Indian Council of World Affairs (ICWA) delegation led by Sh Nalin Surie, which visited Vietnam some months ago. It was a matter of great pleasure to see the remarkable economic progress that Vietnam has made in the recent years. I have no doubt that with India and Vietnam growing rapidly, the comprehensive strategic partnership between the two countries will rise to a new level. What was heartening to see was how positive and warm our Vietnamese friends are towards India. The feeling is fully reciprocated in India.

We need to put the 46 year old India-Vietnam diplomatic relations in the contemporary context. The geopolitical environment in the region is changing rapidly. China’s growing assertiveness has unsettled the region. Although president Xi has spoken about shared destiny, win-win situation etc. but Chinese leaders have not concealed their burning desire to emerge as a great power. The 19th Party Congress was all about China’s roadmap to becoming a great power. The unilateral Chinese moves in the South China Sea (SCS) and its undisguised disdain for the International Court of Justice (ICJ) verdict has shook the world and shown China would not hesitate in acting unilaterally in the areas which it regards as of core concern. In the East China Sea, the situation is tense. The Japanese have complained that Chinese fighter jets violate their air space hundreds of times every year forcing the Japanese Self Defence Forces (SDF) to scramble their jets routinely. In the Indian Ocean, China has acquired bases for its navy, its submarines are roaming freely and the Chinese are building several ports in many countries. Such feverish activity raises apprehensions about Chinese motives.

US policies have also added an additional layer of uncertainty. Obama announced a policy of pivot and rebalance but that has been largely abandoned. US-China relations, which are marked by hostility as well economic interdependence, have their independent logic. The two can make deals with each other when it suits them. China’s Great Power Relations theory postulates leaving out other powers from mutual relations. The alliance partners of the US are asking questions about the US commitment to the alliance. The US withdrawal from the Trans Pacific Partnership (TPP) has left the field open for China in the region.

The North Korean nuclear question is becoming intractable. The tensions are running at unprecedentedly high level. The key role here lies with China and the US. President Trump, after saying his nuclear button is bigger than Kim Un Jung’s has now indicated that the he is ready to talk with the North Korean leader.

ASEAN’s evolving position is instructive. The SCS has divided the ASEAN. The Philippines, which had taken the SCS issue to the ICJ has completely changed its position and is now eagerly looking towards closer ties with that country. ASEAN, which has over 500 billion dollars of annual trade with China, cannot ignore China in any which way. Neither does it have the military nor economic clout to ensure its centrality in the region without China being in agreement. There is little likelihood of ASEAN joining any grouping or order which is seen by the Chinese as anti-China. Confronted with assertive China and an unpredictable US, the ASEAN is being challenged in maintaining its centrality in the region.

On the margins of the East Asian Summit (EAS) in Philippines last year, a meeting of India, Japan, US and Australian officials took place. That is where the idea of ‘Indo-Pacific’ was revived and launched. The construct of Indo-Pacific has been discussed for many years but it has not taken concrete shape as yet. The Japanese PM Abe is a strong supporter. The latest National Security Strategy of the US also mentions it. But, at the moment it is still a work in progress. So far no common statement has been issued. Each member of the ‘Quad’ has its own relationship with China. If the idea is to set up a rule-based order in the Indo-Pacific, then we need to see whether China will be willing to be a part of such an order. China is increasingly looking to become a rule-shaper than a rule-taker.

India has stated clearly that it would like to see an order in the region which is rule-based, open and transparent. India stands of the freedom of navigation and the observance of the international law in maritime affairs. It has also mentioned that it adheres to its strongly held view that the centrality of the ASEAN should be maintained. Some people argue that the EAS itself provides the nucleus of an order in the region. It would be better if the members of the Quad entered into a dialogue with the ASEAN countries to assess how they evaluate the concept of Indo-Pacific.

Economic factors are as important as strategic factors when it comes to shaping the region. There is no doubt that China is the dominant economic power in the region closely intertwined with all its neighbours including the adversaries. It is interesting to see that Japan is taking a nuanced view towards the Belt and Road Initiative. The Japanese feel that if Belt and Road Initiative (BRI) is open and transparent, they could engage with China. Does it mean that Japan, which has over $ 300 billion of trade transactions, can do a modus vivendi with China? Nothing can be ruled out in the present state of flux. Most neighbours of China, except India, have endorsed the BRI despite apprehensions that they might fall into a debt trap. The US withdrawal from the TPP under the ‘America First’ policy of President Trump has raised questions about the US commitment to the region. Japan and other countries including Vietnam are is trying to revive he TPP sans the US. But the focus has now shifted to the Regional Comprehensive Economic Partnership (RCEP) in which China and India are both participating.
The Indo-Pacific region is extremely important for India’s security and prosperity. The region extends not just on the Pacific side but also towards Africa. India’s position on the region crystallizes to the following: Further deepening of the ‘Act East’ Policy; maintaining the centrality of the ASEAN; ensuring the freedom of navigation through the high seas and adherence to international law for an open and inclusive maritime order; an endorsement of the idea of Indo-Pacific which is yet to be fully fleshed out; strengthening of the bilateral and multilateral cooperation among the countries of the region; regional cooperation; reservations about connectivity projects which are motivated by unilateralism and geopolitical considerations; and participation the RCEP for economic integration. At the same time, India would shun any alliances but would take part in partnerships based on common interests.

India Vietnam relations

Seen in this framework, India attaches great importance to its comprehensive strategic partnership with Vietnam. India-Vietnam relations have been quite strong and friendly since their initiation in the late 1950’s. In the past, the two countries were drawn together due to their mutual fight against the imperialism and two cooperated to ensure their mutual security in the bipolar world order. The end of cold war, however, saw the new resurgence in bilateral relation on many issues of mutual security and economic significance. In recent times, India and Vietnam have come to engage on a range of trade and economic issues. Both the countries closely cooperate in various regional forums such as ASEAN, EAS, Mekong Ganga Cooperation and the Asia Europe Meeting (ASEM), besides the UN and WTO. Vietnam is also an important pillar amongst India’s CLMV partners. PM Modi’s visit to Vietnam in 2016 raised the level of our partnership in defence security, economic, cultural and many other areas. There is need to ensure that the projects identified are implemented.

According to Indian government data, the trade volume has crossed $ 9 billion in FY 2014-15 and both the countries seek to achieve the new trade target of $15 billion by 2020. India’s thrust under the Act East policy combined with Vietnam's growing engagement within the region and with India has thus paid rich dividends. In recent years, the two countries have witnessed unique geopolitical challenges marked by the turbulence in SCS region. PM Modi has argued that India can be an anchor for peace, prosperity, and stability from Asia to Africa and from Indian Ocean to the Pacific. In this respect, the two countries have also enhanced the bilateral defence cooperation. The two nations also have keen interest in ensuring sea-lane and energy security. The energy cooperation between the two countries in SCS region is particularly challenging in view of China’s claims on similar territories.

Hanoi is gradually becoming the linchpin of India’s Act East Policy. Both India and Vietnam face the threat from China’s increasing military presence in South China Sea and in the Indian Ocean region. We must also recognize that China is Vietnam’s neighbour and the two have to live with each other. China is its largest trading partner with annual trade at about $ 70 billion. This is the same volume as that between India and China. Despite the Chinese pressure, Vietnam has remained steadfast and refused to succumb. Vietnam is conscious of the fact that there is disconnect between the political and economic dimension of its relations with China. It would therefore like to work with other countries like Japan, India, and US to diversify its interests.

Vietnam welcomes deeper cooperation with India but is disappointed that the economic content of India’s engagement is ‘weak’. Indo-ASEAN Free Trade Agreement (FTA) is considered the weakest. It would like India do more with Vietnam and also in the region. Out of all the ASEAN countries, Vietnam is most concerned about China’s rise and its implications for the region. India should cooperate with Vietnam more and also to play a greater role in the region. Additionally the two countries can enhance sector specific cooperation in areas like Cyber Security and consider offering more scholarship to the Vietnamese. Defense co-operation should also be strengthened. One major gap is the lack of knowledge and information about each other, about each other’s developmental priorities. We need to have a clearer understanding of each other’s vision, aspirations, strengths and weaknesses. We discovered that in the booming economy of Vietnam, Indian participation is still suboptimal.

We need to address these issues. The idea of joint studies to understand the potential of Indo-Vietnam partnership was mooted out during the visit of the ICWA delegation. Links among our universities and think tanks need to be enhanced. In this backdrop this conference is highly significant.

I wish all success in your deliberations.