New Shipping Service Connects China, Vietnam, and India
In an exciting development for intra-Asia shipping, Chinese carrier Zhonggu Logistics and the national line Vietnam Maritime Corp (VIMC) have unveiled a new container shipping service that connects China’s Beibu Gulf with Vietnam and India. This collaboration marks a significant step in enhancing trade routes between these rapidly growing economies.
A Strategic Move Amid Growth
Zhonggu Logistics, recognized as the largest operator of domestic container services in China, made a strategic entry into international shipping amidst the Covid-19 pandemic’s economic landscape. Since 2021, they have operated two services specifically aimed at the China-Vietnam corridor. Now, in partnership with VIMC, they are expanding their reach, tapping into the burgeoning markets of Vietnam and India.
Service Details
Launching yesterday, the VIMC-Zhonggu collaboration will deploy a feeder vessel every three weeks from Qinzhou port. This service will have stops in Hai Phong, Vietnam, and Kolkata, India, enhancing the connectivity between these key ports and facilitating smoother trade operations.
Market Insights
Linerlytica’s analyst, Tan Hua Joo, provided insight into the service’s potential, noting that India and Vietnam are among the fastest-growing regions for container shipping. However, he pointed out that the current service utilizes relatively small ships, with a capacity of 500 TEUs, making it more of a symbolic initiative than a means of mass shipping. Nevertheless, it reinforces the growing trade ties between the two nations.
Economic Significance of Beibu Gulf
The Beibu Gulf, also known as the Gulf of Tonkin Economic Belt, is a vital region that encapsulates China’s south-western coastal areas. This area is a focal point in the government’s “Go West” strategy, which aims to stimulate economic growth in its less-developed regions. The new shipping service is expected to bolster exports from China, including goods like electronics, glass, and paper, while bringing back imports of wood chips, starch, spices, and food products from Vietnam and India.
Enhancing Trade Potential
Le Quang Trung, VIMC’s deputy general director, expressed optimism about how this shipping service would enhance trade between China, Vietnam, and India. In concordance, Liu Shengyou, General Manager of Beibu Gulf Port Group, remarked that this initiative would bridge China’s Belt and Road Initiative and contribute to Vietnam’s Two Corridors, One Belt project, creating a new shipping channel across the land-sea trade corridor of China.
Impressive Capacity Growth
Both Qinzhou and neighboring Fangchenggang ports are anticipated to handle over 10 million TEUs this year, reflecting a growth from 9 million TEUs in 2024, showcasing the increasing capacity and efficiency of China’s ports.
Robust Trade Relationships
China remains Vietnam’s largest trade partner, with bilateral trade exceeding $200 billion last year. Additionally, Vietnam has been Guangxi’s largest trading partner for 26 consecutive years. This established relationship, bolstered by the new shipping service, indicates a promising future for trade connectivity.
Adapting to Changing Trade Dynamics
Amid rising Sino-U.S. trade tensions, Vietnam has witnessed a surge in container exports, as manufacturers increasingly relocate operations to this Southeast Asian nation to avoid stringent U.S. tariffs. Similarly, India’s container shipping market is experiencing rapid expansion, driven in part by government initiatives like Sagarmala, aimed at enhancing cost efficiency through port-led development.
Future Plans for Expansion
VIMC is keen to further strengthen its trade links with India, with plans to introduce additional container services to Chennai and Kattupalli ports later this year. Such moves indicate a proactive approach to business development and position both companies to thrive in an increasingly interconnected commercial landscape.
In summary, the partnership between Zhonggu Logistics and VIMC signifies a noteworthy advancement in container shipping services, enhancing trade links within Asia and opening up new avenues for economic collaboration.