The Indo-Pacific region, particularly the Indo-Pacific Economic Framework for Prosperity (IPEF), has been gaining attention recently due to its initiatives and agreements that both involve India and affect its interests. Recently, the second IPEF Ministerial Meeting was held, highlighting noteworthy developments in enhancing economic cooperation among partnering countries within this region. The virtual meeting convened high-ranking officials for intense discussions concerning the four pillars of the framework and the ongoing negotiations associated with each.
Key Highlights from the Meeting
During the meeting, a significant announcement was made regarding the substantial conclusion of the negotiations of an unprecedented international IPEF Supply Chain Agreement under Pillar II of the framework. This agreement aims to strengthen the resilience, efficiency, productivity, sustainability, transparency, diversification, security, fairness, and inclusivity of their supply chains.
In addition to this accomplishment, the meeting also reported favorable progress under the other IPEF Pillars. These include Fair and Resilient Trade (Pillar I), Infrastructure, Clean Energy, and Decarbonization (Pillar III), and Tax and Anti-Corruption (Pillar IV). There was also the introduction of a regional hydrogen initiative by some IPEF partners designed to promote widespread use of renewable and low-carbon hydrogen and its derivatives in the region under Pillar III.
About IPEF
IPEF is a US-led initiative that endeavors to reinforce economic partnership among participating nations to augment resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness in the Indo-Pacific region. It was launched on May 23rd, 2022 in Tokyo by the USA along with other partner countries of this region.
Current members of IPEF include Australia, Brunei, Fiji, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, the United States, and Vietnam. India has joined Pillars II to IV of IPEF and maintains an observer status in Pillar-I.
Four Pillars of IPEF
The first pillar, Trade (Pillar I), centers on enhancing trade engagement among IPEF partner countries with an aim to foster economic growth, peace, and prosperity in the region.
Supply-chain resilience (Pillar II) aims to fortify supply chains, making them more robust and well-integrated. This includes a focus on crisis response measures, cooperation to alleviate disruption, and improving logistics, connectivity, and investments in critical sectors.
Under the third pillar, Clean Economy (Pillar III), cooperation on clean energy and environmentally friendly technologies is advanced. This involves research, development, commercialization, and deployment of clean energy, along with encouraging investment in climate-related projects in the Indo-Pacific region.
Finally, Fair Economy (Pillar IV), is concerned with the implementation of effective anti-corruption and tax measures. It lauds India’s firm steps in ameliorating legislative and administrative frameworks to combat corruption and asserts commitment to implementing UNCAC (United Nations Convention against Corruption) and FATF (Financial Action Task Force) standards.
