“The disruptions to supply chains due to COVID-19 have encouraged many US companies, including large companies like Google and Microsoft, to migrate to Vietnam,” said Mr Chintamani Mahapatra, Rector at the Jawaharlal Nehru University.
Most recently, Google coordinated with the Vietnam Innovation Centre at the Ministry of Planning and Investment to organise a training course this month for 25 tech startups in Vietnam’s southern region. The courses will support local small and medium-sized enterprises (SMEs) and the country’s development of innovation and a startup ecosystem.
Meanwhile, Microsoft Vietnam and Vietnam International Bank (VIB) announced a three-year strategic partnership in September to leverage Microsoft Azure as the preferred cloud platform, to accelerate the pace of innovation and create valuable new services to meet the present and future banking needs of customers.
According to Mr Mahapatra, one of the reasons why major foreign companies are eying the Vietnamese market is because the country has been doing well with the development of critical infrastructure.
Ms Mahima Duggal, a Research Associate at the Centre for Air Power Studies (CAPS) in New Delhi, believes there is great potential for Vietnam to truly become an innovation hub in Asia and Southeast Asia.
“Amid COVID-19, Vietnam was one of only a few countries to post economic growth and was one of the fastest-growing countries, which expresses the resilience of its economy,” she said.
Vietnam’s GDP growth hit 13.6 percent in the third quarter of 2022 and 8.83 percent in the first nine months of the year; the highest in the nine-month period since 2011 according to the General Statistics Office.
Moody’s, the World Bank, the International Monetary Fund, and the Asian Development Bank have forecast that Vietnam will see GDP growth of 8.5 percent, 7.2 percent, 7 percent, and 6.5 percent, respectively, this year; among the highest in Southeast Asia.
“Vietnam is on its way to establishing itself as a manufacturing powerhouse in the region, and India is looking at the country as a primary partner,” Ms Duggal said.
Referring to the second Vietnam-India security dialogue, which took place in New Delhi in September, Mr Mahapatra said: “I think Vietnam-India relations are on the right track and we should be more optimistic about the stronger cooperation in many areas, including cyber security.”
Emerging areas like artificial intelligence and big data are where Vietnam and India can start to work together because both share a lot of similar issues, according to the Indian analysts.
In particular, when it comes to ASEAN, the analysts believe that Vietnam is definitely one of India’s closest partners, not only in science-technology but also in other fields like trade-economics-investment and education-training.
Data from the General Department of Vietnam Customs shows that two-way trade surpassed 13 billion USD for the first time last year despite the serious impact of COVID-19.
Vietnam is one of the premier partners in the Indian Technical & Economic Cooperation (ITEC) programme. Every year, India grants Vietnam about 130 scholarships under the programme in the form of long-term and short-term courses, according to the General Personnel & Organisation Department at the General Statistics Office of Vietnam.
“A lot of goodwill between Vietnam and India contributed to the establishment of the comprehensive strategic partnership in 2017,” Ms Duggal said. “The two countries share a lot of similarities, which gives them a lot of room for strategic cooperation in different areas, including science-technology.”
At the 2022 Horasis India Meeting, the foremost annual meeting of Indian business leaders and their global counterparts, held on September 26 in Vietnam’s southern province of Binh Duong, Indian investors praised Vietnam as a hub to expand their business into other parts of Asia. More than 700 delegates were brought together at the meeting to discuss issues of common concern, such as global transition, economic development issues arising from the digital transformation process, artificial intelligence, and smart energy.
Among these, Mr Mahapatra said India is trying to invest more in the research and development of artificial intelligence, and the country is looking at Vietnam as a potential partner. Highlighting the potential for cooperation between the two sides in this field, he noted that they can work together in innovation and the development of new kinds of artificial intelligence to increase their economic competitiveness and industrial production as well as education and governance. However, he warned that there are negative fallouts from the use of artificial intelligence by non-State actors.
“We should learn how to develop a firewall, which will protect our critical infrastructure, and this can certainly be one of the frontier areas of collaboration between Vietnam and India.” As tech giant Apple is looking to expand its supply chains in Vietnam and India, Ms Duggal said the two countries need to seize this opportunity to establish manufacturing industries. Nevertheless, the challenge is that the two countries need to move to higher value groups and apply higher value technologies, she added.
“This will require some manoeuvring by both countries and we need to make sure that we are able to take advantage of this opportunity to establish our names in this sector,” she said. According to Indian analysts, there is also huge scope for the two countries’ startup communities to cooperate in the field of science-technology.
Under Project 844, Vietnam aims to assist more than 2,000 startups, 600 of which are expected to grow into giants, and turn the country into an innovative startup centre of Southeast Asia. Meanwhile, India has a lot of startup experience that it can provide to Vietnam, and Indian experts are willing to work with Vietnamese partners to share their experience, the analysts said. Global investors, especially those from Japan and the Republic of Korea, are showing a lot of interest in Vietnam, according to Mr Jagannath Panda, Head of the Stockholm Centre for South Asian and Indo-Pacific Affairs.
“This is definitely a positive sign for Vietnam,” he said. “But at the same time, I think that Vietnam needs to make sure that the emergence of startups is not temporary, but has a long and enduring future. To that extent, I think Vietnam will definitely be interested in terms of learning how startups are being implemented successfully in India.” According to the Indian analysts, the partnership between Vietnam and India will promote new generations of skilled workers. The two sides can work together to create a multitude of startup initiatives as part of efforts to push bilateral cooperation in the field of science-technology./.
