With an estimated size of US$7 billion in 2019, and expected to increase by 8% by 2024, along with increasing facilitation of the business and investment environment, the Vietnamese pharmaceutical market is receiving much interest from many foreign pharmaceutical corporations around the world, including Indian ones.
In recent years, the pharmaceutical industry has been an important area of cooperation between Vietnam and India. Pharmaceuticals and pharmaceutical ingredients have always been the key export items of India to Vietnam. The two sides still have great potential to promote investment cooperation in the pharmaceutical and medical equipment industries.
The topic was on discussion at a seminar on promotion of trade and investment in pharmaceutical sector between Vietnam and India, hosted by the Embassy of India in collaboration with the International Investment Promotion Alliance (INVEST-GLOBAL), Vietnam Association of Foreign Invested Enterprise (VAFIE) and Indian Business Chamber (INCHAM) in Hanoi on January 21.
The Vietnamese pharmaceutical market has grown rapidly, with an estimated value of US$7 billion in 2019. The annual growth is expected to be 8% by 2024. While Vietnamese drug manufacturers are able to meet half of their domestic demand, they depend on imports for approximately 60% of pharmaceutical end products, 90% of active pharmaceutical ingredients and most of the raw materials for the production of pharmaceuticals.
Pranay Verma, Ambassador of India to Vietnam, shared that Vietnam is a key consumer of Indian pharmaceuticals with an annual trade worth US$ 225 million, currently in 19th position among the top 25 destinations for Indian pharmaceutical products.
Emphasising the importance of the pharmaceutical sector in economic, commercial and medical cooperation between both sides, the diplomats also said that the opportunities presented by the pharma sector for the two countries has been duly recognised in the India-Vietnam Joint Vision for Peace, Prosperity and People adopted by both Prime Ministers at the Virtual Summit held in December 2020. Their Joint Vision identifies deepening the cooperation between the two countries in targeted areas, including holistic healthcare, vaccines and pharmaceuticals, as important elements of our future partnership over the coming years.
Amid the difficulties caused by COVID-19, the two countries remained engaged in augmenting healthcare responses to the pandemic. Vietnam assisted India with supplies of facemasks to the Indian Red Cross Society. India, on the other hand, ensured that the production and supply lines remained and ramped up, supplying medicines to manage the pandemic in more than 150 countries around the world, including Vietnam. India also extended a contribution of US$1 million to the ASEAN Covid-19 Response Fund.
Professor, Dr. Nguyen Mai, Chairman of the VAFIE, said that trade and investment in pharmaceuticals, which are among the strengths of both countries, can be further promoted through cooperation to support both sides, bringing into play the advantages of each party and effectively exploiting the potential to increase the two-way trade turnover and investment cooperation.
The seminar explored the emerging opportunities and exchanged views and ideas on ways to promote bilateral engagement in the pharma sector by taking advantage of policies and incentives offered in India and Vietnam.
Panel discussions on opportunities for investment and trade facilitation for Indian pharma sector in Vietnam were held, during which the participants stressed the need for greater Indian investment in pharma sector in Vietnam as well as enhancing awareness in Vietnam about India’s strength as the leading manufacturer of pharmaceuticals.
Representatives from Vietnamese Ministry of Finance and Ministry of Health provided details of incentives offered by Vietnam for investment in the health sector, particularly in hi-tech projects, as well as upcoming new circulars that would further facilitate trade in pharmaceutical products for Vietnam.