Vietnam and India Relations – What Can We Learn?

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While both Vietnam and India have suffered to varying degrees in the wake of the coronavirus pandemic, these nations are poised to enjoy significant growth over the course of the next 12 months.

Vietnam is one of the few economies poised to grow this year, for example, to the tune of an impressive 2.4%. While India has endured a huge contraction in 2020, it will record the highest growth of any Asian nation before the following year is out (9.9% overall).

Interestingly, the growth of these two nations can be at least partially attributed to the relationship that exists between them, but what opportunities does this offer to investors in the modern age?

The Growth of Bilateral Trade Between Vietnam and India

In truth, bilateral trade between India and Vietnam has been steadily rising over the past two decades, with this built on the huge scope for trade in key areas such as gas, oil, pharmaceuticals and IT services.

The reason for this is simple; with Vietnam having emerged as a viable manufacturing and export alternative to China in a post-coronavirus world. As a result of this, Indian entrepreneurs are currently relocating their production hubs to Vietnam and similar ASEAN nations, with this trend expected to continue through 2021.

This burgeoning relationship will almost certainly be fortified in the wake of the pandemic, while the estimated total value of bilateral trade between these two nations could soon rise as high as $1.1 billion.

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Interestingly, 2020 marked the 42nd anniversary of India-Vietnam bilateral trade, while this year has also seen these long standing economic relations materialise into numerous Indian investments across an array of sectors.

What are the Main Areas of Focus and Why Should You Invest?

From the perspective of individual investors, IT services and technological sectors represent the next big frontiers in developing nations such as Vietnam and India.

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Vietnamese Prime Minister Nguyen Xuan Phuc has underlined this recently, having signed an executive order that puts cryptocurrency and blockchain amongst its top-5 investment priorities.

This is part of the country’s ongoing commitment to reposition Vietnam as a prominent driver of the Fourth Industrial Revolution, with investors being encouraged to help research, develop and apply cryptocurrency projects across the board.

Of course, cryptocurrency now represents a huge growth market and viable option for investors, and in this respect, Vietnam provides a highly attractive proposition in the digital age.

In both countries, manufacturing also provides a huge opportunity for investors, particularly in light of Vietnam’s recently agreed trade deal with the UK. This will certainly provide a further boost to the region’s export market, as UK companies are encouraged to outsource their production in Vietnam and the country prepares to save $151 million in tariffs placed on goods.

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Targeting these areas is crucial from the perspective of investors, while interested parties should arguably make their move sooner rather than later.

After all, growth in these two nations is expected to soar in 2021, so there remains a small window of opportunity to cash in on stocks and shares while they’re relatively undervalued.

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