India Enters Into Supply Chain Agreement with IPEF

16 Nov, 2023

India Enters Into Supply Chain Agreement with IPEF

The Indo-Pacific Framework for Prosperity (IPEF) represents a significant collaboration involving India and 13 other nations. Their recent formalization of a pivotal agreement aims to strengthen the resilience of their supply chains, marking a crucial milestone in their joint efforts to foster closer economic ties among member countries.

The signing ceremony occurred during a prominent ministerial meeting held in San Francisco, where these nations, collectively commanding a substantial portion of the global economy, united. Together, they contribute to 40% of the world's economic output and constitute 28% of global trade activities, underscoring their influence.

What distinguishes the IPEF is its comprehensive approach spanning four key tracks: trade, supply chains, clean energy and infrastructure, and tax and anti-corruption. Although India has chosen not to engage directly in trade negotiations, it maintains an observer status, staying involved in these discussions.

The newly ratified supply chain agreement is anticipated to be instrumental in fortifying and elevating the resilience of the IPEF's supply chains. Piyush Goyal, India's Commerce and Industry Minister, highlighted the historic importance of this agreement, recognizing it as a groundbreaking international pact fortifying global supply chains while promoting adaptability and sustainability within these networks.

Earlier negotiations focused on fortifying supply chain resilience to withstand potential disruptions. Additionally, ongoing discussions center on the clean economy and fair economy pillars, emphasizing the multi-dimensional nature of the agreement and the alliance's commitment to broader economic cooperation.

The agreement outlines a comprehensive framework encompassing the understanding and mitigation of supply chain risks, coordinated crisis responses, investment mobilization, and the promotion of regulatory transparency in sectors critical for national security and public health. To ensure effective implementation and monitoring, the alliance plans to establish several bodies such as The IPEF Supply Chain Council, convening annually to oversee progress. Furthermore, initiatives like The IPEF Supply Chain Crisis Response Network and The IPEF Labour Rights Advisory Board aim to provide support and guidance during critical times.