In a significant development, India has taken a proactive step towards strengthening its economic ties by signing an agreement with the US and 12 other members of the Indo-Pacific Economic Framework for Prosperity (IPEF). The announcement, made by the commerce ministry, underscores India’s commitment to reducing its dependence on China and addressing the risks posed by supply chain shocks.
The agreement, formally inked by India’s Union Minister for Commerce and Industry, Piyush Goyal, and US Trade Secretary Gina Raimondo in San Francisco, aims not only to decrease dependency on China but also to enhance supply chain resilience. This move is seen as a collective effort by IPEF member nations to prepare for future challenges related to supply chain disruptions.
Expressing the significance of this collaboration, Minister Goyal took to X (formerly Twitter) to announce, “India joins the US and 12 other IPEF partners to ink the IPEF supply chain resilience agreement that will fortify and strengthen global supply chains and foster adaptability, stability, and sustainability.”
The agreement holds several potential benefits for member nations. It opens avenues for the shifting of production centers in critical sectors, a crucial step in reducing reliance on a single source. Additionally, it aims to mitigate the risk of economic disruptions arising from supply chain shocks. The focus is on fostering adaptability, stability, and sustainability in global supply chains.
The commerce ministry highlighted other advantages of the pact, including supply-chain diversification, mobilization of investments, deeper integration of India into global value chains, support to Micro, Small, and Medium Enterprises (MSMEs), and the creation of a seamless regional trade ecosystem facilitating the flow of Indian products.
During the IPEF meet, Minister Goyal engaged in discussions with Gina Raimondo, as well as trade ministers from Malaysia (Tengku Zafrul Aziz) and Indonesia (Airlangga Hartarto). The meetings focused on bilateral collaboration on trade, commerce, and investment, enhanced business engagements, WTO matters, and other mutual interests.
The IPEF, launched in Tokyo on May 23, 2022, comprises nations such as Australia, Brunei Darussalam, Fiji, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam. This collaborative framework signifies a collective effort to bolster economic ties in the Indo-Pacific region, emphasizing resilience, diversification, and increased cooperation. Stay updated on the progress of this strategic initiative shaping India’s economic landscape.
