By Phuong Nguyen and Francesco Guarascio

HANOI (Reuters) -Vietnam is preparing for a decision on Tuesday by index provider FTSE Russell that could upgrade its stock market to emerging status alongside China and India, potentially unlocking billions of dollars in foreign investment.

The Southeast Asian nation is currently classified as a frontier market both by FTSE and rival MSCI, a designation seen as riskier that prevents many institutional investors and passive funds from buying shares of locally listed companies.

FTSE said in a note last month that it would make an announcement about Vietnam’s possible reclassification on October 7 after the close of the U.S. market as part of a regular annual review.

Vietnam’s benchmark index has surged 30% this year, making it one of the top-perf

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