Handing over 12 patrol vessels to Hanoi on Thursday, India offered more defence projects for Vietnam to ensure a larger share in the unprecedented growth in military modernisation of the South-East Asian nation.
Indian Defence Minister Rajnath Singh has also urged Vietnam to join a 'Make in India' project to export military equipment to third countries.
"I'm confident that this (12 patrol vessels) will be a precursor to many more cooperative defence projects between India and Vietnam," Rajnath Singh said on his second day of ongoing visit to Vietnam.
The 12 high-speed boats were constructed under the $100 million defence line of credit offered by India in 2014.
Private firm L&T has manufactured the initial five vessels at a shipyard in India, and the balance seven have been built at Hong Ha Shipyard in Vietnam.
The boats are believed to be used in patrolling around 200 nautical miles Exclusive Economic Zone as China has asserted its claims in the South China Sea. China carried out military drills in March as part of Vietnam's claimed Exclusive Economic Zone in the area.
Vietnamese Prime Minister Phạm Minh Chính has urged New Delhi to support Hanoi in effectively implementing the 1982 United Nations Convention on the Law of the Sea (UNCLOS) in the South China Sea.
For his part, Rajnath Singh agreed with his host, saying that the practical and effective realisation of the UNCLOS is necessary to create an "environment of peace, stability, cooperation and development in the region and the world."
On Wednesday, the two countries signed a Joint Vision Statement for Defence Partnership towards the year 2030, which will “significantly enhance” the scope and scale of bilateral defence cooperation.
India and Vietnam are now negotiating $500 million defence loans offered by Indian Prime Minister Narendra Modi in 2016, which would involve Hanoi procuring military-grade equipment from New Delhi on preferential terms.
The offers to sell the BrahMos missile, Akash missile, and other maritime assets have come after Vietnam increased its defence spending by 700 percent in the last 20 years, and nearly doubled it in the previous 10 years. Last year, Vietnam spent $5.1 billion on defence modernisation.
Last November, then-Indian Foreign Secretary Harsh Vardhan Shringla had warned the regional countries of "an increasingly complicated, rapidly evolving, and more demanding security situation, with an ever-increasing number of threats and uncertainties".
Last year, the Indian Prime Minister had instructed the country's defence manufacturers to focus on countries worried about their security in the present geopolitical world.