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Indo-Pacific Economic Framework for Prosperity

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    25th May, 2022


Recently, India joined a dozen other nations to launch the Indo-Pacific Economic Framework for Prosperity (IPEF), a US-led trade initiative meant to counter China’s aggressive expansion in the region. 

What is IPEF?

  • The grouping, which includes seven out of 10 members of the Association of South East Asian Nations (ASEAN), all four Quad countries, and New Zealand, represents about 40% of global GDP.
  • IPEF is short for Indo-Pacific Economic Framework for Prosperity. The framework envisions a free, open and secure Indo Pacific Region. 
  • The negotiations for the IPEF are expected to centre around four main pillars, including trade, supply chain resiliency, clean energy and decarbonisation, and taxes and anti-corruption measures.
  • Countries would have to sign up to all of the components within a module, but do not have to participate in all modules.
  • The “fair and resilient trade” module will be led by the US Trade Representative and include digital, labor, and environment issues, with some binding commitments.
  • The IPEF seeks to strengthen economic partnership amongst participating countries with the objective of enhancing resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness in the Indo-Pacific region.

About the Indo-Pacific region

  • The Indo-Pacific region is the centre of manufacturing, economic activity, global trade and investment. 
    • The world’s oldest commercial port was in Lothal Gujarat, India.
  • India is committed to a free, open, and inclusive Indo-Pacific region and believes that deepening economic engagement among partners is crucial for continued growth, peace, and prosperity.
  • India is keen to collaborate with partner countries under the IPEF and work towards advancing regional economic connectivity, integration and boosting trade and investment within the region.

India’s Indo-Pacific strategy 

  • India’s Indo-Pacific strategy walks on two legs-
    • Strengthening national engagement with the region- It elevates India’s salience in the Indo-Pacific and raises Delhi’s value for its partners
    • Stronger partnerships with like-minded nations- To boost India’s national capabilities and enhance its reach and impact.

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