Close on the heels of the visit of Vietnamese Prime Minister in January as a guest at Republic Day along with other Asean leaders, the President of Vietnam Tran Dai Quang visited India last weekend.

In India’s ‘act east’ policy, Vietnam has been the major pivot, at least in terms of security and strategic imperatives. Vietnam has been consistently supportive of India’s engagement with Asean and its other outfits such as the East Asia Summit, Asean Regional Forum and ADMM+.

Advertisement

While India has had cultural linkages with the Indo-China region, in modern times it extended political support to Vietnam during its protracted liberation struggle.

New Delhi had also been actively involved in the historic Geneva Conference of 1954 that brought peace, although elusive, to the region. There was deep friendship and understanding between Prime Minister Jawaharlal Nehru and Vietnam’s great leader Ho Chi Minh.

The legendary military leader of Vietnam General Giap, was also held in high esteem in India particularly by leaders of the communist persuasion. In that sense, India’s engagement predates its ‘look east’ policy, which is now christened as ‘act east’ policy.

India’s engagement with Vietnam was elevated to ‘comprehensive strategic’ level during the visit of Prime Minister Narendra Modi in 2016. There is also an institutional mechanism of Foreign Office consultation and strategic dialogue between the two countries.

There have been exchanges of visits between defence personnel of the two countries from time to time. Naval ships from India have also been making calls at Vietnamese ports. The Indian Navy has been supplying critical spare parts to Hanoi for its Russian origin ships and boats.

In recent past, Indian and Vietnamese engaged in joint patrols, and both navies participated in a joint exercise. India has also repaired and upgraded over 100 MiG planes of the Vietnam Air Force and supplied them with enhanced avionics and radar systems. Indian Air Force pilots have been training their Vietnamese counterparts.

India’s foray into the South China Sea has indeed given a new twist to its engagement with Vietnam and to India’s ‘act east’ policy. There has been a perception that India’s foray into South China Sea is to contain China.

The fact is that the cooperation between ONGC Videsh and Petro-Vietnam goes back to the 1980s, which led to the signing of the Production Sharing Contract between Hydrocarbon India Ltd, renamed as ONGC Videsh, and Petro-Vietnam in May 1988.

In June 2006 they signed the deal for the award of two exploration blocks, 127 and 128 in PhuKan basin in Vietnam through regular bidding process. The contract between ONGC Videsh and Petro-Vietnam is periodically renewed.

ONGC Videsh got a two-year extension to explore the Vietnamese oil block in July 2017 in the disputed South China Sea. It is the fifth extension for OVL to explore Block 128, the licence for which is now valid till June 2019.

While India wants to maintain its strategic interest in the South China Sea, Vietnam wants India to counter China’s interventions in the area. It is reported that OVL had applied in May 2017 to the Vietnamese authorities for the fifth extension of the exploration licence.

OVL had signed a production sharing contract for the 7,058 square km block 128 in 2006. The company has not found any hydrocarbon in the block but is continuing to stay invested to maintain India’s strategic interest.

OVL first took a two-year extension of the exploration period till June 2014 and then another one year. A third extension was granted in in May 2015 and a fourth last year. The company has so far invested $50.88 million in the block.

The agreement is intended for developing long-term cooperation in oil and gas industry and shall be in force for three years.

Some of the key areas in which both companies wish to cooperate are related to exchange of information on the petroleum industry, new investments, expansion and operations of oil and gas exploration and production including refining, transportation and supply in Vietnam, India, and third countries.

Besides state-owned ONGC Videsh , private players like Essar Oil have have been engaged in oil exploration in the South China Sea.

OVL’s efforts to drill a well in block 128 were not successful due to logistical constraints in anchoring the rig on a hard sea bottom. ONGC Videsh earlier had abandoned block 127 after it failed to find any hydrocarbon there.

OVL continues operations at block 6.1 in the same region, from where it got 2 billion cubic meters (BCM) of gas in 2011-12 for its 45 per cent participating interest.

India has already made its position very clear with regard to the South China Sea issue. It has said its engagement in the South China Sea is purely for commercial purposes.

New Delhi is of the view that the South China Sea issue should be resolved peacefully by the involved countries in accordance with the United Nations Convention on the Laws of the Sea. It, however, supports freedom of navigation.

There is a perception in some strategic circles that India’s foray into South China Sea is in response to China’s advances in the Indian Ocean and its infrastructural development in Pakistan Occupied Kashmir, issues of concern to India.

India’s nuanced position is that it stands for a cooperative, inclusive and rule-based security architecture that enhances collective security and regional and global stability. The India-Vietnam relationship has its own imperatives and dynamism.

The writer was a senior fellow with the Institute for Defence Studies and Analyses. Views expressed are personal.