I am able to connect two VPC networks in a GCP project using Cloud VPN with dyanmic routing or Just using VPC Network peering. Cloud VPN with dynamic routing behaves same as VPC network peering. I am trying to understand when to use VPC network peering and When to use Cloud VPN with dynamic routing.
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From google cloud docs - https://cloud.google.com/vpc/docs/vpc-peering
VPC Network Peering gives you several advantages over using external IP addresses or VPNs to connect networks, including:
Network Latency: Public IP networking suffers higher latency than private networking.
Network Security: Service owners do not need to have their services exposed to the public Internet and deal with its associated risks.
Network Cost: GCP charges egress bandwidth pricing for networks using external IPs to communicate even if the traffic is within the same zone.
If however, the networks peer they can use internal IPs to communicate and save on those egress costs. Regular network pricing still applies to all traffic.