In News: Commerce and Industry Minister Piyush Goyal has said that an official level discussion on Indo-Pacific Economic Framework will be held in India
India and US have also finalised dates for the next Commercial Dialogue and the CEO Forum meeting to be held in India this year.
Indo-Pacific Economic Framework:
In 2022, the United States launched the Indo-Pacific Economic Framework for Prosperity (IPEF) with Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam (together these countries represent 40% of world GDP)
It aims to ensure – Connected Economy, Resilient Economy, Clean Economy and Fair Economy
It has four pillars
Trade
Supply Chains
Clean Energy, Decarbonization, and Infrastructure
Tax and Anti-Corruption
It is a significant step toward establishing free and fair trade with nations that share the same values of a rule-based international order and a transparent economic system.
The IPEF is designed to be flexible, meaning that IPEF partners are not required to join all four pillars.
Significance for India:
India’s economic engagement with the Indo-Pacific countries has been through bilateral trade agreements, rather than joining a trade block because of the concerns about tariffs and cheap imports that would threaten the competitiveness of local producers.
However, the IPEF offers India a large opportunity to become a technology leader in the region, especially in two areas- semiconductor supply chains, and clean energy.
India can be the destination for new investment such as in the semiconductor sector.
The Quad framework can be applied in the supply chain network that US technology, Japanese capital, Australia’s logistics, and Indian production could fill the vacuum created by the countering domination of China.
