The choppy South China Sea

With the Vietnamese Prime Minister’s recent visit to Delhi, the Modi government has underlined its intention to take the Hanoi-Delhi ties forward from the momentum it has gained in the last few years. The two sides agreed to enhance bilateral trade to $15 billion by 2020 and signed seven agreements in key areas of defence, trade, security, and counter-terrorism. India agreed to operationalise a $100 million line of credit for Vietnam, and provide support to modernise Vietnam's security forces. Vietnam offered two more oil blocks for exploration in the South China Sea to India. The two blocks offered were among the five blocks Vietnam had offered to India earlier. India made it clear that the oil blocks offered to it fall in Vietnam's exclusive economic zone contrary to China’s claims.

New Delhi maintained that legitimate rights and interests of nations in the sea must be guaranteed and all disputes must be solved by peaceful means on the basis of international law, especially the UN Convention on the Law of the Sea (UNCLOS), and the full and serious implementation of the Declaration on the Conduct of Parties in the East Sea (DOC) towards the early conclusion of a Code of Conduct (COC) in the East Sea. This was a forceful message to China as was Prime Minister Modi’s articulation that India remained “committed to the modernisation of Vietnam's defence and security forces. This will include expansion of our training programme, which is already very substantial, joint exercises and cooperation in defence equipment... We will quickly operationalise the 100 million dollars Line of Credit that will enable Vietnam to acquire new naval vessels from India.” 

Beijing made its displeasure known by suggesting that no third party should involve itself in the tense maritime tussle between Beijing and Hanoi. "China has indisputable sovereignty over the Nansha islands. Any lawful oil exploration activity in the South China Sea is fine by us. But if such activity undermines the sovereignty and interests of China we are firmly opposed to this," Chinese foreign ministry reacted to the growing closeness between New Delhi and Hanoi.

It is instructive that India entered the fraught region of the South China Sea via Vietnam. India signed an agreement with Vietnam in October 2011 to expand and promote oil exploration in the South China Sea and then reconfirmed its decision to carry on despite the Chinese challenge to the legality of Indian presence. Beijing told New Delhi that its permission was needed for India’s state-owned oil and gas firm to explore for energy in the two Vietnamese blocks in those waters. But Vietnam quickly cited the 1982 United Nations Convention on the Law of the Sea to claim its sovereign rights over the two blocks in question. Hanoi has been publicly sparring with Beijing over the South China Sea for the last few years, so such a response was expected.

What was new, however, was New Delhi’s new-found aggression in taking on China. It immediately decided to support Hanoi’s claims. By accepting the Vietnamese invitation to explore oil and gas in Blocks 127 and 128, India’s state-owned oil company ONGC Videsh Ltd (OVL),  not only expressed New Delhi’s desire to deepen its friendship with Vietnam, but ignored China’s warning to stay away. This display of backbone helped India strengthen its relationship with Vietnam. If China wants to expand its presence in South Asia and the Indian Ocean region, New Delhi’s thinking goes, India can do the same thing in East Asia. 

Hanoi is gradually becoming the linchpin of this eastward move by New Delhi. Hanoi fought a brief war with Beijing in 1979 and has grown wary of the Middle Kingdom’s increasing economic and military weight. That’s why in some quarters of New Delhi, Vietnam is already seen as a counterweight in the same way Pakistan has been for China.

That’s not to say good India-Vietnam relations wouldn’t exist otherwise. Vietnamese have traditionally held Indians in high regard because of the latter’s support for Vietnamese independence from France and their opposition to US involvement in the country. And New Delhi formulated a Look East policy as early as 1991, to capitalize on East Asia’s economic growth. But the rise of China has given this relationship a powerful strategic, not to mention urgent, dimension. 

Both sides realise that a stronger bilateral relationship starts with economic ties. The two countries signed an agreement in 2003 in which they envisioned creating an Arc of Advantage and Prosperity in Southeast Asia. So they have been boosting trade, especially after New Delhi signed a free-trade agreement with the Association of South-East Asian Nations in 2009 and concluded talks on Free Trade Agreement (FTA) on services and investment in 2012 which is expected to increase bilateral trade to $200 billion by 2022. 

Both sides could still do more to enhance economic cooperation. Bilateral trade is much below the potential, given that India and Vietnam are major emerging economies. The two countries also need to think creatively about expanding investment opportunities, especially in the energy, steel, and pharmaceutical sectors. This can be done by establishing stronger institutional mechanisms that review the economic relationship on a regular basis and take steps to enhance it.

New Delhi’s abiding interest in Vietnam, though, is in the defense realm. It wants to build relations with states like Vietnam that can act as pressure points against China. With this in mind, it has been helping Hanoi beef up its naval and air capabilities. 

The two nations also have stakes in ensuring sea-lane security, as well as shared concerns about Chinese access to the Indian Ocean and the South China Sea. Hence, India is helping Vietnam to build capacity for repair and maintenance of its defense platforms. At the same time, the armed forces of the two states are now cooperating in areas like IT and English-language training of Vietnamese Army personnel. The two countries potentially share a common friend -- the US. New Delhi has steadily built relations with Washington in the past decade, while Vietnam has been courting America as the South China Sea becomes a flashpoint. As these three countries ponder how to manage China’s rise, they will be drawn closer together. 

By lashing out against India for its dealings with Vietnam as well as with other states in East and Southeast Asia, China has shown it will try to deter strategic competitors from collaborating against it. But if both India and Vietnam stand firm, they could force Beijing to moderate its expansionist claims on the South China Sea and adopt a more conciliatory stance on other regional matters.

The author teaches at King's College, London