Members of the 14-nation bloc IPEF have 'substantially' concluded the negotiations on the supply chains agreement, including improving logistics and connectivity; promoting investments in critical sectors and cooperation for mitigation of disruptions to ensure business continuity, the commerce ministry said on Sunday.
The IPEF was launched jointly by the US and other partner countries of the Indo-Pacific region on May 23 in Tokyo. The framework is structured around four pillars relating to trade, supply chains, clean economy and fair economy (issues like tax and anti-corruption).
India has joined all the pillars except the trade one.
The talks on supply chains, clean economy and fair economy were held on May 27 in Detroit, US. Commerce and Industry Minister Piyush Goyal virtually participated in the ministerial meeting.
“At this meeting, negotiations under the Supply Chains (Pillar-II) were substantially concluded; while good progress was reported under the other IPEF Pillars,” the ministry said.
The proposed agreement on supply chains aims to increase the resilience, efficiency, productivity, sustainability, transparency, diversification, security, fairness and inclusivity of their supply chains through collaborative activities and individual actions taken by each IPEF partner.
IPEF partners will undertake the necessary steps, including further domestic consultations and a legal review, to prepare a final text of the proposed IPEF supply chain agreement.
Once finalised, the proposed agreement will be subject to IPEF partners' domestic processes for signature, followed by ratification, acceptance or approval.
Under this pact, the partners also seek to improve crisis coordination and response to supply chain disruptions and work together to support the timely delivery of affected goods during a crisis.
A press statement issued after the meeting by IPEF members said that the proposed supply chain pact contemplates the establishment of three new IPEF Supply Chain bodies to facilitate cooperation among the partners.
The three bodies will be - the supply chain council; the supply chain crisis response network, and IPEF Labor Rights Advisory Board.
“The proposed agreement would establish a new advisory board, consisting of government, worker and employer representatives, as well as a subcommittee composed of government representatives, to support the IPEF partners' promotion of labour rights in their supply chains, promotion of sustainable trade and investment, and facilitation of opportunities for investment in businesses that respect labour rights,” the statement added.
Under the supply chain agreement, IPEF partner countries are seeking to make supply chains more resilient, robust and well-integrated through crisis response measures; cooperation for mitigation of disruptions to better ensure business continuity and improve logistics and connectivity; promoting investments, particularly in critical sectors and production of key goods and worker role enhancement through requisite upskilling and reskilling.
During his intervention under this pillar, Goyal urged for expeditious implementation of all the action-oriented cooperative and collaborative elements identified as part of this agreement.
As part of the clean economy pillar, the member countries are aiming to advance cooperation on research, development, commercialisation, availability, accessibility, and deployment of clean energy and climate-friendly technologies.
Besides, they are talking to facilitate investment towards climate-related projects in the region.
Further, interested IPEF partners are introducing a regional hydrogen initiative to encourage the widespread deployment of renewable and low-carbon hydrogen and its derivatives in the region.
Goyal said that India would like the pillar focus to be centred on action-oriented elements, such as the mobilisation of low-cost long-tenure climate finance and enhanced access to clean energy technologies.
Under the fair economy pillar, IPEF partners are working towards the development of the text of an agreement that will strengthen the implementation of effective anti-corruption and tax measures to boost commerce, trade and investment among IPEF economies.
IPEF partners represent 40 per cent of global GDP and 28 per cent of global goods and services trade.
The 14 countries include the US, Japan, Australia, New Zealand, the Republic of Korea, India, Fiji, and seven ASEAN countries (Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam).