Shri Piyush Goyal, Union Minister of Commerce and Industry, Consumer Affairs, Food and Public Distribution, and Textiles, attended the third in-person IPEF Ministerial meeting on November 14, 2023. The Union Minister of India and the Ministers of the other IPEF partner nations signed the first-ever IPEF Supply Chain Resilience Agreement during this Ministerial meeting. Shri Piyush Goyal also called for the early execution of the planned collaborative effort under IPEF, particularly the alliance India has proposed for biofuels. Productive talks about the significant advancements made by IPEF partners on Pillar-III (Clean Economy) and Pillar-IV (Fair Economy) were also held by the ministers of IPEF member countries.
Supply Chain Resilience Agreement
- The US, India and twelve other IPEF members have signed a Supply Chain Resilience Agreement.
- During the ministerial conference of the Indo-Pacific Economic Framework for Prosperity (IPEF), the agreement was signed in San Francisco.
- The members of the Indo-Pacific Economic Framework For Prosperity (IPEF) wrapped up talks on Supply Chain Resilience On May 27, 2023 in Detroit.
- The agreement would enter into force after implementation by any of the five participating nations.
Components of Agreement
IPEF Supply Chain Council
- The IPEF Supply Chain Council would be established by the IPEF block to execute and oversee the agreement.
- The council would convene once a year, and all members would be required to report on the success of the agreement's implementation.
IPEF Supply Chain Crisis Response Network
- The IPEF Supply Chain Crisis Response Network would be established by the IPEF block.
- The network would handle emergency issues and assist partners in seeking assistance during a supply chain disruption.
- It will also facilitate information sharing and collaboration among IPEF partners during a crisis, allowing for a faster response that minimises negative economic effects.
IPEF Labor Rights Advisory Board
The IPEF Labor Rights Advisory Board that the IPEF block would establish which would support members in advancing worker rights throughout their supply chains.
Significance of Supply Chain Resilience Agreement
- IPEF supply networks should become more strong, resilient, and well-integrated as a result of the Supply Chain Resilience Agreement.
- Member nations like India would benefit from the deal by becoming less dependent on China.
- Benefits from the agreement would include the possible relocation of manufacturing facilities in important industries and the reduction of the danger of supply chain shocks causing economic disruptions.
About Indo-Pacific Economic Framework For Prosperity (IPEF)
- The Indo-Pacific Economic Framework For Prosperity (IPEF) is a programme launched by the United States.
- It seeks to fortify economic ties between member nations in order to augment the Indo-Pacific region's resilience, sustainability, inclusivity, economic growth, equity, and competitiveness.
- Together, the twelve founding partners of the IPEF, which was established in 2021, account for 40% of global GDP.
- On May 23 of last year, in Tokyo, the US and other Indo-Pacific area partners jointly inaugurated IPEF.
- Although members are free to negotiate the sections they like, the IPEF is not a free trade agreement (FTA). There will be four primary "pillars" along which to negotiate.
- Its current members include India and 13 Pacific Ocean nations.
- Members of the bloc are the US, Vietnam, Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and the United States.
- It is a framework for the economy designed to increase US engagement in Asia.