On this day, in 1974, Chinese and then-Republic of Vietnam (RVN) navies clashed  with one another in close-proximity maneuvers off the islands of the Paracel archipelago.
The incident happened after the South Vietnamese army discovered the presence of the Chinese People’s Liberation (PLA) Army in the Crescent Group located to the west of the Paracel Islands, which were at the time controlled by the RVN.
The skirmish took place amid the US reduction of military assistance to South Vietnam after the signing of the Paris Peace Accords in 1973, and the withdrawal of some South Vietnamese troops stationed on the islands.
Prior to the incident, the Chinese had reportedly not taken unilateral actions to subvert the established status quo, in which the PLA controlled the Amphitrite Group in the east and the RVN controlled the Crescent Group.
The fighting lasted for several hours and eventually led to the defeat of the South Vietnamese navy, followed by China’s full occupation of the islands. South Vietnam lost 74 soldiers in the skirmish. 
According to The 1974 Paracels Sea Battle,  a research paper published by Toshi Yoshihara in the U.S. Naval War College, although the 1974 Sino-Vietnam maritime battle both happened in small scope and attracted little public attention when compared to past naval struggles, it reveals “a far more complex naval operation” by the Chinese that “could be employed again in the future.”
Why are the Paracel Islands important?
Bill Hayton, a former correspondent in Vietnam and the author of The South China Sea: The struggle for power in Asia, writes  that many countries are concerned these islands can be used as “springboards” for Beijing to assert its control “over the whole of the South China Sea.”
Moreover, whoever gains control over these islands will “have the strongest claim to the 1.4 million sq miles of the South China Sea and all the fish in it and oil under it,” Hayton adds.
What is the current Vietnamese government’s perception of the battle?
Hanoi has previously restricted public discussion of Vietnam’s maritime dispute with China in 1974. Firstly, it is because the current Communist government has not formally recognized the U.S.-backed South Vietnamese government up until this day.
Additionally, the previous North Vietnamese government did not counter or acknowledge the Chinese invasion of the islands, as Beijing was supplying North Vietnam with arms and money to fight the United States and its ally in the south. 
Nonetheless, the current government had begun to commemorate the historical event through a desensitization effort  in 2014. That year, Hanoi allowed a controllable-scale commemoration of the 1974 event and of the South Vietnamese soldiers who died in the conflict.
 Ngo Minh Tri, Koh Swee Lean Collin. (2014, January 23). Lessons from the Battle of the Paracel Islands. The Diplomat. https://thediplomat.com/2014/01/lessons-from-the-battle-of-the-paracel-islands/
 Brummitt, C. (2014, January 17). In shift, Vietnam marks 1974 battle with China. Associated Press. https://apnews.com/article/48b31a41ac134b06b2c57532b60218ed
 Yoshihara, T. (2016). THE 1974 PARACELS SEA BATTLE: A Campaign Appraisal. Naval War College Review, 41–65.
 Hayton, B. (2015, May 3). Tiny islands key to ownership of South China Sea. BBC News. https://www.bbc.com/news/world-asia-29560533
 Ibid., 
 Nguyen, J. (2022, January 1). 2011-2021: Ten Years Of Social Changes In Vietnam. The Vietnamese Magazine. https://www.thevietnamese.org/2021/12/human-rights-and-democracy-how-vietnam-has-changed-since-2011/