With an eye on China's assertive behaviour in the Indo-Pacific, India and Vietnam agreed to deepen defence and security cooperation, including thorough co-production of Indian defence equipment, after External Affairs Minister S Jaishankar met visiting Foreign Minister of Vietnam Le Hoai Trung on Monday.
Jaishankar, who co-chaired the 19th India-Vietnam Joint Commission Meeting (JCM), said "Vietnam for us is a key partner in India's Act East Policy, in our Vision MAHASAGAR and in our Comprehensive Strategic Partnership with ASEAN."
Defence and security is among central pillars of the Enhanced Comprehensive Strategic Partnership. Bilateral engagement has diversified to military-to-military dialogue and training among all arms. In July 2023, India gifted indigenously built missile corvette INS Kirpan to Vietnam. Earlier, 12 high-speed guard boats built by Larsen & Toubro under a $100 million Line of Credit were handed over in June 2022.
Two more Lines of Credit of $120 million and $180 million have been signed between Exim Bank of India and Vietnam's Finance Ministry in July 2024, and are being undertaken.
According to the official statement: "They identified the way forward on deepening ongoing defence and security collaboration, including through co-production of Indian defence items; expanding trade, market access for marine and agri products, financial, port and air connectivity."
Jaishankar noted the State Visit of Vietnam's top leader To Lam to India and elevation to Enhanced Comprehensive Strategic Partnership — Vietnam is first in region at that level.
Analysis: Co-production is the upgrade from gifting. From patrol boats to Kirpan to now joint production, India is moving from donor to defence-industrial partner, exactly where Vietnam wants to diversify away from Russia. For Delhi's MAHASAGAR vision and IPOI, Vietnam is the anchor in South China Sea. For Hanoi, Indian credit plus tech is leverage against Beijing without joining an alliance.