Table of Contents
DETAILS
- On most trade indicators, Vietnam scores over India.
- Vietnam’s total merchandise exports grew at an annualised average rate of 18 per cent in the last 10 years till 2019, as compared with India’s 5 per cent.
- During the same period, Vietnam attained a trade surplus of $47 billion, which again was a significant improvement over the trade deficit of $13 billion in 2010.
- While Vietnam started delivering trade surplus, India’s trade deficit increased to $156 billion in 2019 from $130 billion in 2010.
VIETNAM
- Socialist Republic of Vietnam
- Vietnam shares its land borders with China to the north, and Laos and Cambodia to the west.
- GDP -$262 billion (nominal, 2019 est.)
WHAT DOES VIETNAM EXPORT TO THE WORLD
- Vietnam’s top exports, in 2019, comprised electrical machinery and equipment
- (with 41 per cent share), apparel (11 per cent), footwear (8), and machinery and mechanical appliances (5).
DETAILS
- South Korea-based Samsung has one of its largest facilities outside its home country in Vietnam.
- In 2012, Samsung established a dedicated LFD business, Samsung Display Solutions, catering to the company’s SMART range of LED products. In fact, the company assembles half of its global handsets in Vietnam and has benefited hugely post the US-China trade war.
- In 2018, the total sales by Samsung Electronics in Vietnam amounted to $66 billion which accounted for as much as 28 per cent of the country’s GDP.
- Reportedly, in such cases, Samsung is likely to diversify its production lines for making smartphones to India under the PLI (Production Linked Incentive) scheme —should this happen it will be a boost.
WHAT ARE THE REASONS FOR VIETNAM’S SUCCESS?
- As the Economic Survey points out: “Bangladesh, China, and Vietnam… have more than 80% of market value of exports by large enterprises, India has 80% by small enterprises. Moreover, in India it can take 7-10 days to reach a port whereas in countries like China, Bangladesh and Vietnam it takes less than a day.” Network products are made across countries and, hence, need quick turnaround times. In Vietnam, it takes 0.3 days for a consignment to reach a port. In Bangladesh it takes about a day.
VIETNAM ISBETTERINTRADEDIPLOMACY
- Vietnam ratified a free trade agreementwith the European Union. This will mean tariffs on most products that the country exports to the European Union will either be cut or eliminated totally. Hence, it makes even more sense for companies moving their operations out of China to move to Vietnam now.
- Meanwhile, in India, we are still harping about our low-cost advantage. While that matters, it is not the only factor.
VIETNAM IS A ONE PARTY STATE
- As Vietnam is a one-party state, the ruling Communist Party of Vietnam was the only party to contest the elections.
- The Communist Party of Vietnam (CPV) is the founding and ruling communist party of the Socialist Republic of Vietnam.
Latest Burning Issues | Free PDF
WhatsApp