India, Vietnam ink 7 pacts; call for 'freedom' of navigation

Strategically important oil and gas cooperation and extension of a USD 100 million credit by India for defence purchases are among the seven pacts inked between India and Vietnam as they called for "freedom" of navigation in the South China Sea, a remark that could irk China which has been claiming territorial sovereignty over the high seas.

PTI| Last Updated: Sep 15, 2014, 16:37 PM IST

Hanoi: Strategically important oil and gas cooperation and extension of a USD 100 million credit by India for defence purchases are among the seven pacts inked between India and Vietnam as they called for "freedom" of navigation in the South China Sea, a remark that could irk China which has been claiming territorial sovereignty over the high seas.

The agreements were signed during the second day of the four-day state visit of President Pranab Mukherjee who held talks with his Vietnamese counterpart Truong Tan Sang here.

Both the countries decided to strengthen and deepen bilateral ties on the basis of the strategic partnership with focus on political, defence and security cooperation.

They decided to step up collaboration in the economic sector, science and technology, culture and people-to-people links.

In a subtle message to China, India and Vietnam, who established strategic ties in 2007, asserted that the freedom of navigation in the disputed waters of the resource-rich South China Sea should not be "impeded" and called all the parties "concerned" to exercise restraint in this context.

"The leaders reiterated their desire and determination to work together to maintain peace, stability, growth and prosperity in Asia. They agreed that freedom of navigation in the East Sea/South China Sea should not be impeded and called the parties concerned to exercise restraint, avoid threat or use of force and resolve disputes through peaceful means in accordance with universally recognised principles of international law, including the UNCLOS-1982," said a joint communique issued after the meeting.

China has been exerting its influence in these waters which is not taken well by Vietnam and other bordering countries like the Philippines. Beijing has also objected to India's exploration projects in the Vietnamese oil blocks.

Among the seven pacts inked, a Letter of Intent (LoI) was signed between the ONGC Videsh Limited (OVL) and Vietnam Oil and Gas Group (PetroVietnam).

The LoI is aimed at further consolidating cooperation between India and Vietnam in energy sector and pave the way for future collaboration between the two countries.

The two sides urged for "collective commitment of the concerned parties to abide by and implement the 2002 Declaration on the Conduct of Parties in the South China Sea and to work towards the adoption of a Code of Conduct in the South China Sea on the basis of consensus.

"They called for cooperation in ensuring security of sea-lanes, maritime security, combating piracy and conducting search and rescue operations," it said.

India and Vietnam also signed an MoU on extension of USD 100 million Line of Credit to Hanoi for defence procurement.

The pact, inked between the Exim Bank of India and the Vietnamese Finance Ministry, provides a concessional line of credit for procurement of defence equipment from India. Details of equipment to be procured by Vietnam are under finalisation.

Another significant pact signed during Mukherjee's visit here is an MoU on operating and jointly promoting direct air services between Vietnam Airlines and domestic Indian air carrier Jet Airways.

For the first time, India and Vietnam will have direct daily flights from November 5 with Jet Airways connecting Delhi and Mumbai to the historic Ho Chi Minh City.

"We will be beginning the operations from November 5. There will be a flight daily and it would connect Delhi and Mumbai to Ho Chi Minh City," Jet Airways chairman Naresh Goyal told PTI after signing a deal in this regard.

Apart from the LoI, the MoU on extending a credit line to Vietnam for defence purchases and the agreement on operating and jointly promoting direct air services, other pacts inked were -- agreement on cooperation and mutual assistance in customs matters, MoU on animal health, MoU on setting up of Pangasius breeding and farming in India and MoU on cooperation in youth affairs and skill development.

"Both the nations also agreed to continue closer interaction under the institutional architecture of the strategic partnership, particularly the Joint Commission meeting, the Foreign Office consultations and strategic dialogue, security dialogue and other dialogue mechanisms between the two countries," the joint communique said.

After the delegation-level talks, Mukherjee and Truong oversaw the signing of pacts on the seven different subjects in the presence of dignitaries and senior government officials.

The two sides also agreed to undertake focussed cooperation in defence procurement.

"The leaders agreed that defence and security cooperation was an important pillar of the strategic partnership between the two countries. They expressed satisfaction with the ongoing cooperation between the two sides in this field and noted that the signing of the MoU for the Line of Credit of USD 100 million for defence procurement extended by India to Vietnam would open new avenues for cooperation," the joint statement said.

They also reiterated their desire and determination to work together to maintain peace, stability, growth and prosperity in Asia, it said.

Official talks between the two leaders were held in an atmosphere of "friendship and mutual trust".

"President Sang and President Mukherjee exchanged views on the socio-economic developments and foreign policy of their respective countries, bilateral relations and issues of mutual interest," the statement said.

Mukherjee also congratulated the government and people of

Vietnam on the remarkable achievements recorded in recent years while Sang saluted India on the successful completion of the recent Lok Sabha elections and expressed his belief that under the leadership of the new government, the Indian people will attain greater achievements in national development.

The two leaders also agreed to enhance the economic partnership and strengthen the trade and investment linkages between the public and private sectors of both countries, including forging joint ventures.

A sapling of the revered 'Bodhi' tree, originally located in Gaya in Bihar, was today planted in the Presidential palace of Vietnam by Mukherjee, the second such offshoot of the holy tree in this country.

Mukherjee along with Truong planted the sapling in the nicely maintained lawns of the palace soon after the two leaders finished delegation level talks and signing of the seven pacts.

During the talks, the two sides also called for stronger bilateral economic cooperation.

"They welcomed the strong growth in bilateral trade in recent years and urged business to further expand and diversify trade to achieve the bilateral trade target of USD 15 billion by 2020. They identified tourism, garments and textiles, pharmaceuticals and agriculture as important areas of potential growth in bilateral trade," the statement said.

The two leaders highlighted scope for expansion in ICT, science and technology, space and other areas.

The MoU on line of credit of the Exim bank signed today will explore opportunities for this cooperation in the future.

"Details of equipment to be purchased by Vietnam are under finalisation," the joint statement said.

Before meeting his Vietnamese counterpart, Mukherjee visited the Ho Chi Minh's residential complex here and laid wreath at the memorial of National Heroes and Martyrs.

Upon his arrival to the Presidential palace, Mukherjee was given a guard of honour.

The Indian delegation comprises Oil Minister Dharmendra Pradhan and five other Parliamentarians.