India, US, & 12 other IPEF members ink supply chain resilience agreement

The supply chain resilience agreement would help mitigate risks of economic disruptions from supply chain shocks and improve crisis coordination. The agreement would help IPEF member countries to reduce their dependence on China.

Image Source: USTR

India, the US, and twelve other Indo-Pacific Economic Framework for Prosperity (IPEF) group members have inked a supply chain resilience agreement. The agreement aims to soften risks of economic disruptions arising from supply chain shocks and enhance crisis coordination. The agreement would also help IPEF member countries like India to reduce their dependence on China and provide timely information to the IPEF member countries about potential supply disruptions.

The agreement was signed by Union Minister for Commerce and Industry Piyush Goyal and the US Trade Secretary Gina Raimondo at the ministerial meeting of the IPEF in San Francisco.

In a post on the social networking platform X, on November 15, Piyush Goyal said, “India joins the US and 12 other IPEF partners to ink the IPEF Supply Chain Resilience Agreement, a first-of-its-kind international agreement that will fortify and strengthen global supply chains; and foster adaptability, stability and sustainability.” The minister further called for the early implementation of the planned collaborative effort under IPEF, including a bio-fuels alliance as proposed by India.

According to the commerce ministry, the other benefits of the pact include supply chain diversification, mobilisation of investments, deeper integration of India in global value chains, support to MSMEs and creation of a seamless regional trade ecosystem, which would facilitate the flow of Indian products.

IPEF was launched in Tokyo by the US and other countries in the Indo-Pacific region on 23 May 2022. The framework is structured around four pillars relating to trade, supply chains, clean economy and fair economy (issues including tax and anti-corruption). Except for the trade-pillar, India has joined all the pillars.

Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, the U.S. and Vietnam are members of the bloc.