India and Vietnam build a bond with the Dragon in mind, but beyond China

In Tam Giáo — Vietnam’s syncretic moral tradition blending Confucian order, Buddhist balance and Taoist harmony — the ideal society is one in which different forces do not clash, but find their proper place. India and Vietnam, two civilisations shaped by invasion, ideology and geography, are rediscovering such harmony in geopolitics.

The visit of Vietnamese President Tô Lâm to India marks an effort to deepen a relationship embedded in common ground against an assertive China and the reorientation of supply-chain risks.

The timing is telling. Asia’s strategic orchestra is increasingly dominated by a single booming instrument: China. Though both countries remain deeply entwined with it economically, an assertive Beijing is forcing a rebalance, both strategic and commercial. This is especially acute in access to critical minerals. The logic of deeper India-Vietnam ties is thus less about opposition than insulation. In Tam Giáo terms, this is balance, not confrontation.

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Enhanced strategic partnership

During the visit, bilateral ties were elevated to an “Enhanced Comprehensive Strategic Partnership”. Diplomatic adjectives are often dismissed as inflationary. This one is not. India reserves such terminology for a small circle of partners, and Vietnam’s inclusion reflects the steady deepening of ties.

The upgrade places Vietnam beyond being an ASEAN partner and positions it as a durable pillar of India’s Indo-Pacific strategy. Vietnam, in turn, sees India as a stabilising power — large enough to matter, but historically disinclined to dominate. That asymmetry of comfort is rare in Asian geopolitics, and valuable.

Defence cooperation

Defence has quietly become the spine of the relationship. India has trained Vietnamese submarine crews and shared expertise in coastal surveillance. During this visit, India extended a robust $500m defence credit line to procure 12 fast patrol vessels, submarine batteries and upgrades for naval ships. Talks are at an advanced stage to supply Vietnam with BrahMos missiles — a likely mega-deal worth $700m. The Indian side confirmed that discussions on BrahMos are under way. President Tô Lâm’s visit is likely to push the relationship decisively beyond training and capacity-building towards hardware and deterrence.

Vietnam’s interest in the battle-proven system is practical: the BrahMos missile offers credible sea-denial capability. For India, the sale would mark a turning point: its most consequential defence export to date, and proof that it can supply frontline systems, not just patrol boats and radars.

Financing has been the principal hurdle. Vietnam is now working to close that gap through sovereign funding and credit arrangements. Should the deal proceed, it would anchor a broader defence-industrial relationship.

Maritime convergence in the Indo-Pacific

Vietnam’s decision to join India’s Indo-Pacific Oceans Initiative gives this cooperation a multilateral spine. The initiative is deliberately modular, allowing partners to cooperate on maritime security, connectivity, ecology or disaster response without subscribing to a rigid alliance structure. Vietnam’s participation lends the initiative credibility in South-East Asia, where strategic autonomy remains sacrosanct.

The maritime logic is simple. Vietnam sits astride some of the world’s most contested sea lanes; India commands the approaches to the Indian Ocean. Cooperation between the two shortens warning times, broadens maritime domain awareness and complicates the calculations of any power-seeking unilateral control.

Trade: ambition catching up with geography

Strategic warmth has not yet been matched by economic scale, but the gap is narrowing. India and Vietnam announced a target to expand bilateral trade to $25bn by 2030. The goal is ambitious, but not fanciful. Two-way trade currently stands at around $14-15bn, and has doubled in a decade. Vietnam is now among India’s top trading partners in ASEAN. However, India is looking to revisit its ASEAN free-trade agreement, perceived as skewed in ASEAN’s favour, with India’s trade deficit with the bloc ballooning to $40bn in 2023. With a new, more equitable trade deal expected by the end of 2026, India’s trade with Vietnam could indeed match those ambitious numbers.

Complementarities are evident in trade composition. India exports pharmaceuticals, petroleum, steel, machinery, cotton yarn and IT services. Vietnam sends electronics, mobile phones, machinery, chemicals and agricultural products. Investment flows remain modest — Indian cumulative investment in Vietnam is roughly $2bn, while Vietnamese investment in India is smaller — but both governments treat this as a lagging indicator rather than a structural constraint.

The visit produced deliberately practical outcomes. India granted market access for Vietnamese durians, a politically sensitive export for Hanoi. Vietnam opened its market to Indian grapes by easing phytosanitary barriers. Such measures rarely command headlines, but they are the connective tissue of sustained trade growth.

Vietnam is also synchronising India’s Unified Payments Interface (UPI) with its own digital payments system, a move that will streamline transactions for the many Indians flocking to Vietnam — a major tourist destination, with 292,500 visitors in 2024 and numbers likely to grow as direct flights expand and middle-class travel surges. This digital bridge not only foreshadows deeper commercial integration, turning tourism into a gateway for broader economic flows.

Rare earths and critical minerals

The most consequential pillar of the relationship may lie underground. Vietnam holds some of the world’s largest rare-earth reserves, second only to China by some estimates. India, meanwhile, is developing processing capability, scientific expertise and a pressing need to diversify supply chains as rare earths become central to clean energy, electronics and defence systems.

Both sides have expressed interest in cooperation across the rare-earth value chain — from exploration and extraction to refining and downstream manufacturing. Beyond rare earths, discussions have included lithium, cobalt, nickel and tungsten, all critical for batteries, aerospace and advanced manufacturing. For India, Vietnam offers an alternative to China-centric mineral ecosystems. For Vietnam, India offers a partner capable of adding value in the long term as it boosts refining capacity.

Culture as strategy

Strategic partnerships endure when they rest on cultural confidence. India’s assistance in establishing a Site Interpretation Centre at the UNESCO-listed My Son Temple Complex underscores the civilisational depth of the relationship. The temples bear the imprint of Indic traditions going back 2,000 years that filtered through local aesthetics and belief systems.

Unlike infrastructure-heavy cultural diplomacy elsewhere in Asia, India’s approach is understated: conservation, scholarship and interpretation rather than spectacle. In Vietnam, where nationalism is deeply tied to cultural autonomy, such restraint travels further than grand gestures.

Why this visit mattered

President Tô Lâm’s visit mattered because it aligned multiple trajectories. Defence exports, mineral supply chains, trade facilitation and cultural diplomacy were all nudged in the same direction. Most importantly, the visit clarified intent. India sees Vietnam as a long-term strategic partner in East Asia, not a counterweight of convenience. Vietnam sees India as a dependable power — one that seeks balance rather than hierarchy. Both are clear-eyed about China: indispensable economically, unsettling strategically, and therefore best engaged from a position of diversified strength.

In Tam Giáo philosophy, harmony does not mean sameness. It means different elements knowing their place, limits and purpose. India and Vietnam are not allies in the Western sense. They are something subtler, and potentially more durable: partners bound by converging interests and a shared preference for equilibrium over dominance.

If this partnership deepens as intended — through BrahMos missiles, shared oceans, rare earths and trade corridors — it may offer a template for middle powers navigating an increasingly crowded Asian century. Not loud enough to provoke. Not weak enough to be ignored. Balanced enough to endure.

This was thus a landmark visit.

(The writer is a senior journalist with expertise in defence. Views expressed are personal and do not necessarily reflect those of Firstpost.)