India and U.S led Indo-Pacific Economic Framework

Published
12th Sep, 2022

Context

India has decided to join three pillars of the United States-led Indo-Pacific Economic Framework (IPEF)--supply chains, tax and anti-corruption and clean energy–while opting out of the trade pillar for now.

About

India was the only country not to join the declaration on trade.
Members: India, USA, Australia, Brunei, Fiji, Indonesia, Japan, Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam.

Indo-Pacific Economic Framework (IPEF):

The Indo-Pacific Economic Framework (IPEF) was launched by United States (US) President Biden in Tokyo in May, 2022.
The IPEF has four pillars:
Trade
supply chains
clean energy, decarbonisation and infrastructure
tax and anti-corruption
Except Cambodia, Laos and Myanmar, other Southeast Asian nations are a part of the IPEF.
The Framework will advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for our economies.
Through IPEF, the partners aim to contribute to cooperation, stability, prosperity, development, and peace within the region.
The Framework will also offer tangible benefits that fuel economic activity and investment, promote sustainable and inclusive economic growth, and benefit workers and consumers across the region.
The 14 IPEF partners represent 40 percent of global GDP and 28 percent of global goods and services trade.

Four Pillars:

Trade Pillar: In the Trade Pillar, the IPEF partners will seek high-standard provisions in areas that are foundational to resilient, sustainable, and inclusive economic growth, including labour, environment, digital economy, agriculture, transparency and good regulatory practices, competition, inclusivity, trade facilitation, and technical assistance and economic development.
Supply Chain Pillar: In the Supply Chain Pillar, the countries will seek to coordinate actions to mitigate and prevent future supply chain disruptions and secure critical sectors and key products for our manufacturers.
Clean Energy Pillar: In the Clean Energy Pillar, the countries will seek to expand investment opportunities, spur innovation, and improve the livelihoods of citizens as the partners unlock the region’s abundant clean energy resources and substantial carbon sequestration potential.
- The partners aim to advance cooperation on clean energy and climate-friendly technologies, as well as mobilize investment and promote usage of low- and zero-emissions good and services.
Fair Economy Pillar: In the Fair Economy Pillar, the countries will seek to level the playing field for businesses and workers within partner countries by preventing and combatting corruption, curbing tax evasion, and enhancing transparency, recognizing the importance of fairness, inclusiveness, the rule of law, accountability and transparency.