EEPC India looks to tap Vietnam’s potential

R. Maitra

With Vietnam’s great appetite for manufacturing products to accelerate industrialisation and modernisation and given the modest engineering exports and imports between it and India, Shri R. Maitra, executive director of India’s engineering export promotion body, EEPC India, believes there is a tremendous potential for the two nations to boost cooperation, as he outlines to VIR.

Engineering exports play a significant role in India’s external trade. How big a part does Vietnam play?

It is true that engineering exporting is a very vibrant sector in India because it accounts for 25 per cent of our total trade. Last fiscal year 2010-2011 it reached $60 billion, representing 85 per cent growth on-year. Assuming engineering exports remain a fourth of India’s total exports, in two years time it will represent $125 billion. So it is significant to note that India’s engineering exports have become the main propeller for growth in India’s total exports.

Although I do not have the accurate figures of engineering exports to Vietnam at the moment, I believe it ranks after Singapore, Indonesia, Malaysia and Thailand.

Still, do you see any potential for boosting Indian engineering exports to Vietnam?

Yes, Vietnam has tremendous potential and indeed it is possibly importing a lot of Indian products from a third country. Furthermore, actually the Indian government policy is to look east. We call it Engage East Policy. South East Asia is our focus now, no doubt about it. The entry into force of the India-ASEAN Free Trade Agreement on Trade in Goods from January, last year should contribute significantly to the envisaged trade target of $70 billion by 2012 as set by ASEAN and India. Your country is part of ASEAN so we are really looking at Vietnam also for a future market and for future promotion activities. Vietnam is already on our radar.

We [EEPC India] really want to establish direct contacts with Vietnam’s leading importers and exporters so that they can have first-hand knowledge of Indian products. You can see we have exported much to the Chinese or Thai markets and maybe those products are re-exported to your country.

Market demands vary within ASEAN and for Thailand specifically, your interests are automobile manufacturing. So what in Vietnam interests you?

It is capital machinery and plant machinery. Vietnam is a developing country and its demands for these products are huge. We are also to make some studies to know more about Vietnam’s needs. We will determine what products we are to take to Vietnam after we consider Vietnam’s total import basket. In Vietnam we are not a significant partner yet. So we can consider, for example, bringing food processing machines to Vietnam, or we can take farming machinery and a lot of capital machinery to the country also.

India and Vietnam inked a strategic partnership several years ago. However, this important deal does not seem to serve as a major platform for boosting Indian engineering exports to Vietnam. Is the lack of information about Vietnam the main reason?

Yes, it is. We will try to bring some companies and trade delegations with us to Vietnam [to get more information about Vietnam market]. In the past we sent some delegations to Vietnam, but may be they did not reach the right people or the right organisations.

How can you solve it?

First we must test how interested you are in Indian products. We are to invite leading commerce and industry associations, exporters and importers from Vietnam to our upcoming show in Mumbai next March. It is a huge international engineering show and the Vietnamese partners will have a wonderful opportunity to get first-hand information about Indian products [rather than obtaining it from a third country]. After we find they are really interested in Indian products we can do something very big in Vietnam also.

EEPC India appears to have been only interested in specialised shows. Is it a point of note for Vietnamese trade promoters to attract your attention?

Yes, that is true. We have never gone to general and multi-product exhibitions. We can go to specialised shows in Vietnam and if there are such proposals we will consider [them].