Indo-Pacific Nations Forge Alliance to Enhance Supply Chain Resilience

Indo-Pacific Nations Forge Alliance to Enhance Supply Chain Resilience

In a significant step towards bolstering supply chain resilience, the Indo-Pacific Economic Framework for Prosperity (IPEF) – a group comprising 14 countries including the United States and India – has signed a groundbreaking agreement. This pact aims to identify potential supply chain disruptions, promote adherence to labor regulations, and foster a more resilient and robust global supply network.

The IPEF, initially established to reduce reliance on China, is expected to finalize deals on two additional pillars – clean energy and taxation – during its upcoming meeting. With the supply chain pillar now under negotiation, the trade pillar remains the only outstanding area of discussion, with India yet to commit to its inclusion.

Indian Commerce and Industry Minister Piyush Goyal, currently in San Francisco for the IPEF meeting, hailed the agreement as a “first-of-its-kind” international pact that will fortify and strengthen global supply chains while promoting adaptability, stability, and sustainability.

To facilitate cooperation among IPEF partners, three supply chain bodies will be established: the supply chain council, the supply chain crisis response network, and the IPEF labor rights advisory board.

Addressing labor concerns within the agreement, Commerce Secretary Sunil Barthwal emphasized that the focus is on regulations and the commitment is aligned with domestic laws. He further clarified that the agreement does not extend beyond existing labor laws and that a cooperative mechanism will be established, without a dispute settlement system.

This agreement marks a significant step towards strengthening supply chain resilience and promoting responsible labor practices within the IPEF region. The upcoming negotiations on clean energy and taxation are expected to further enhance economic cooperation among the member countries.