| Promoting Trade between Nghe An and the Indian market Export of wood and wood products to the Indian market grows by 3 digits |
Sir, at the end of September 2023, the Vietnam Coffee and Cocoa Association (VICOFA) organized a delegation of Vietnamese coffee businesses to attend the World Coffee Conference and Exhibition (WCC) held in Bengaluru, Karnataka, India. Could you please share a little about this event as well as the effectiveness of the event in promoting coffee exports to India - one of the largest markets for Vietnamese coffee?
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| Mr. Bui Trung Thuong - Commercial Counselor, Vietnam Trade Office in India |
India has surpassed China to become the world's most populous market. In the context of slowing global exports, India's exports have also decreased recently. However, Vietnam-India trade remains stable compared to the same period last year.
In recent times, the Vietnam Trade Office in India has carried out many trade promotion programs and one of the important events was the trade promotion of coffee in India within the framework of the International Coffee Conference. With the support of the Ministry of Industry and Trade and the Coffee Association, Vietnam organized a coffee business delegation with many large Vietnamese enterprises to attend this program such as Vinh Hiep Company Limited, Olympic Coffee Joint Stock Company, etc.
Within the framework of the program, the Embassy and the Trade Office of Vietnam in India organized many programs to promote Vietnamese coffee such as tasting, introducing unique coffee products and promoting Vietnamese coffee. As a result, Vinh Hiep Company Limited signed a memorandum of understanding with an Indian partner to develop the company's L'amant coffee brand to this market.
Coffee is currently an important export item of Vietnam to India, but the turnover and proportion of coffee turnover compared to the total agricultural export volume are still limited. In 2022, Vietnam's coffee exports to India were about 60 million USD, an increase of 5% over the same period last year. Indians are very fond of Vietnamese instant coffee. Besides L'amant, Trung Nguyen and G7 brands have also developed very well in India. The governments of the two countries are still negotiating to reduce import taxes, at which time Vietnamese coffee will have a strong presence in India.
Along with the above major event, it is known that since the beginning of the year, the Trade Office has supported businesses in implementing many activities to promote agricultural exports. Could you provide more specific information about these activities?
On April 28, 2020, most countries had not yet been severely affected by Covid-19, but at that time, India had fallen into a nationwide lockdown and many plans had been delayed. At that time, we sought solutions and discussed with the Trade Promotion Department - Ministry of Industry and Trade and the Indian Chamber of Commerce to organize the first online trade promotion.
After that event, throughout 2020 and 2021, online trade promotion became a trend and we are very proud to be one of the first Trade Offices to popularize this form of trade promotion.
For other activities, in 2022, on the occasion of the 50th anniversary of Vietnam - India diplomatic relations, we organized 50 programs both in person and online, including general programs on the market and detailed programs on industries, products or programs introducing legal regulations, market quality standards, online exchange programs... for businesses.
Since the beginning of the year, under the direction of the Ministry of Industry and Trade, we have supported many delegations such as the delegation of the Minister of Agriculture and Rural Development to attend the G20 Ministerial Conference to promote trade. In addition, we have supported businesses in many industries such as handicrafts, spices, agricultural products, wooden furniture, etc. to learn about market information. This year alone, wooden furniture exports to India have increased significantly. In the context of difficult markets, India can completely become one of the alternative markets.
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| Cinnamon is Vietnam's main export item to India (Photo: Vinasamex) |
Regarding cinnamon, Vietnam's cinnamon exports to India currently account for about 80% of the market's cinnamon import demand. According to Indian data, in the 2022-2023 fiscal year, India imported 38,000 tons, of which 35,000 tons came from Vietnam.
India is a very potential market, but exporting is not easy. Because in the context of India's export difficulties, they will also find ways to protect the domestic market, creating jobs for businesses and workers. But when we know that there is a product that has a market advantage like cinnamon, businesses need to be proactive and not rely too much on Indian traders.
Next November, India will have a large fair on food products. This is an important activity of India in promoting trade and commerce with countries around the world. It is expected that 70 countries will come to this market. India plans to organize a booth to promote Vietnamese products. If businesses cannot come to India, they can send us samples so that we can support their promotion. If businesses can come directly, this will be a great opportunity to learn not only about the Indian market but also about many businesses in other countries participating in the fair.
As someone who has worked in India for many years, can you provide more detailed information about the potential of this market for Vietnamese agricultural products and spices?
India currently has a population of 1.4 billion people. With a wide range of customers, the 1.4 billion population is divided into 4-5 groups with diverse needs.
With spices, India is the world's largest consumer and the world's second largest exporter. They import many products from us and then make higher-end products to export. For example, with incense, their consumption is very large and they only import raw incense from Vietnam, which has a very low value. Then they do the final step of flavoring, increasing the value 3-4 times. Why can't Vietnamese businesses complete that step to increase the value of the product?
With spices, government agencies have great support. The Spices Board under the Ministry of Commerce and Industry of India is responsible for formulating development policies and planning medicinal plant growing areas to avoid overlap. India has an agency for promoting agricultural exports to support market development, support businesses in selling, and support Indian buyers to interact with manufacturers.
However, cinnamon or spices are almost exclusive products of Vietnam in India. Therefore, businesses should promote trade promotion solutions, learn carefully about the market to increase export value. Besides, businesses should unite, otherwise if they compete on price, they do not know when they will compete.
In the coming time, what solutions will the Vietnam Trade Office in India have to support Vietnamese enterprises to boost exports to this market, sir?
We identify India as a very potential market and must find ways to overcome difficulties together to penetrate deeper into this market. In the current context, in addition to quality, businesses must have a story to tell behind the product. Therefore, trade promotion activities will focus on solutions.
Firstly, continue to implement trade promotion programs by combining diverse forms.
Second , we will continue to orientate market information. Like China, India has large states, but specific information about the states is very limited. The previous deal aimed to disseminate to businesses every Wednesday what information the provinces and states have and what they need. There were sessions that attracted up to 200 businesses to attend, but the number is gradually decreasing. We believe that greater interaction and deeper investment by businesses is needed so that businesses can have greater opportunities in this market.
Third, we always encourage Vietnamese businesses to come to India and create an ecosystem in the Indian market. Besides being a larger market, India's e-commerce is currently about 10 years behind Vietnam. However, this gap will be erased very quickly, so it is very appropriate for businesses to approach the market at this time.
Thank you!
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