The Indo-Pacific Economic Framework (IPEF) Ministerial meeting recently took place in the US, drawing attention to India’s strategic and economic interests in the region. The meeting brought forth important discussions on topics like the Indo-Pacific, Quad, and various Comprehensive Economic Partnership Agreements (CEPA), all of which hold great significance for India.
The Indo-Pacific Economic Framework (IPEF)
The IPEF is a US-led initiative launched in 2021. It aims to strengthen the economic partnership among its member countries, enhancing resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness in the Indo-Pacific region. Initially, twelve partners joined the IPEF, representing 40% of the world’s GDP. The framework is not a Free Trade Agreement (FTA), but rather an arrangement where members can negotiate on four main pillars: Supply-chain resilience, Clean energy and decarbonization, Taxation and anti-corruption, and Fair & resilient trade. Current members include Australia, Brunei, Fiji, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, United States, and Vietnam.
India’s Stance on the IPEF
India has maintained a cautious approach towards the IPEF. It has not declared a definitive stance, waiting to see the benefits for member countries and judging whether certain clauses relating to the environment may disadvantage developing countries. Some of the IPEF’s proposals do not align with India’s national interest, particularly those relating to digital governance. India is currently restructuring its own digital framework and laws, primarily dealing with privacy and data issues. As such, it is monitoring the evolution of the IPEF before taking a definitive stand.
How is IPEF Different from Other Trade Deals?
Unlike most trade deals, the IPEF does not make it mandatory for members to commit to all four of its pillars. Members are free to decide which aspects they wish to be a part of, meaning it is not a traditional “take-it-or-leave-it” agreement. This flexibility makes IPEF unique among other multilateral trade deals.
India’s Vision for the Indo-Pacific Region
Trade between India and the countries in the Indo-Pacific region has seen substantial growth. India’s overseas investments are increasingly heading East, with Comprehensive Economic Partnership Agreements with Japan, South Korea, and Singapore, as well as Free Trade Agreements with ASEAN (Association of Southeast Asian Nations) and Thailand. India has been actively promoting a Free and Open Indo-Pacific, a concept that has received support from the US, Australia, and ASEAN members. Together with its Quad partners, India aims to cooperatively manage a rules-based multipolar regional order to prevent any single power from dominating the region or its waterways.
UPSC Civil Services Examination Question
In a previous year question in the UPSC Civil Services Examination, candidates were asked to discuss the new tri-nation partnership AUKUS, aimed at countering China’s ambitions in the Indo-Pacific region, and analyze whether it would supersede existing partnerships. The question emphasized the importance of understanding the intricacies and impact of such strategic alliances in the current geopolitical scenario.
