The Commerce Department has sought the Union Cabinet’s approval for the United States-led Indo Pacific Economic Framework’s (IPEF) ‘supply-chain’ agreement, according to informed sources.
“The legal vetting process of the supply chain pillar’s text is now complete. The full text, along with the texts of all four pillars under the IPEF, will be made public in November,” an individual privy to the matter told Business Standard.
The economic initiative encompasses four pillars: trade, supply chain resilience, clean economy, and fair economy (tax and anti-corruption). As it currently stands, the supply chain resilience is the first pillar to be finalised by the 14 IPEF member nations.
In May, an official statement reported the substantial conclusion of negotiations for a ‘first-of-its-kind international IPEF Supply Chain Agreement’ at the IPEF Ministerial Meeting in the US. During a subsequent ministerial meeting held earlier this month in South Korea, officials also progressed the legal review of the proposed agreement.
The primary goal of the agreement is to enhance the ‘resilience, efficiency, productivity, sustainability, transparency, diversification, security, fairness, and inclusivity’ of supply chains through both collaborative activities and individual actions undertaken by each IPEF member nation.
The agreement aims to fortify supply chains, integrate them more cohesively, improve crisis coordination and responses to supply chain disruptions, and facilitate the timely delivery of affected goods to member countries during a crisis. Additionally, it targets capacity building to boost investment in critical sectors.
The Commerce Department has also initiated an outreach programme to inform the industry about the proposed supply chain agreement, enabling industry players to prepare for its implementation.
Alongside the US, the 13 other members of the IPEF include Australia, Brunei, Fiji, Indonesia, India, Japan, Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam.