Business in mind, Vietnam PM lands in India Wednesday


New Delhi : Vietnamese Prime Minister Nguyen Tan Dung begins a three-day tour of India Wednesday, keen to give a fillip to commercial ties at a time both countries are experiencing an unprecedented economic boom.

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Accompanied by a 163-member delegation comprising ministers, leaders of various provinces and 80 businesspersons, Dung kicks off his visit from Kolkata, which has had historical ties with Vietnam. He is expected to visit the Tata Steel complex in Jamshedpur and meet with corporate chiefs of the Essar group of companies.

"While China is rising, India is emerging, Vietnam is booming," exclaimed Vu Quang Diem, Vietnam's ambassador to India, hoping his prime minister's trip would help improve the investment environment.

Last month, Tata Steel signed a $3.5 billion agreement with Vietnam Steel Corporation, the country's largest steel company to build a 4.5 million tonne steel mill in Ha Tinh province, 340 km south of Hanoi.

While the Indian steel major will have a 65 percent stake in this project, the agreement also entitles it to a 30 percent equity stake in an iron ore mining project in Vietnam's Thach Khe area.

Essar Global had won a contract for a two million tonne capacity hot rolled steel strip mill valued at $527 million in Vung Tau province.

In Mumbai, Dung will meet Indian CEOs and businesspersons, inaugurate the Indo-Vietnam Business Forum and visit the Knowledge City before arriving in New Delhi Friday.

"He will meet the political leadership here and official talks between the two prime ministers and delegations will be followed by a joint declaration and signing of agreements," said the ambassador.

Dung's visit to India assumes significance as Vietnam has chosen 2007 for focussing on developing relations with India. It also marks the 35th anniversary of establishment of full-scale diplomatic relations between the two sides.

Bilateral trade between the two countries has significantly increased from $50 million in the mid-80s to over $1 billion in 2006. In recent years, the value of two-way trade has increased steadily, at an average of 20 percent per year.

While Vietnam's main exports are coffee, coal, pepper, cinnamon and electronics, India's exports to Vietnam include cattle-feed, materials, iron and steel, metals, plastic, pharmaceuticals and machinery.

Both sides are working closely to reduce Vietnam's trade deficit and to increase the value of two-way trade to $2 billion by 2010.

In the little over three decades since Vietnam has gone from communism to a form of capitalism, it has begun outdoing many of its neighbours.

With an 8.4 percent growth last year, trailing only China's, it is one of the world's fastest-growing economies as foreign direct investments and the pace of exports continue to rise.