Country still to remain out of key trade pillar
The Union cabinet may soon take up a proposal from the commerce and industry ministry, seeking approval for the country to sign the clean-economy and fair-economy agreements of the Indo Pacific Economic Framework for Prosperity (IPEF), a senior official said.
“Inter-ministerial consultations are complete. The commerce ministry has sent both the pacts to the Cabinet Secretariat,” the official added.
The clean economy is Pillar III and the fair economy is Pillar IV of IPEF. India has already signed Pillar II of IPEF that deals with supply chain. The supply chain agreement entered into force in February. Other members of the 14-member IPEF have already signed the agreement on pillars III and IV and an overarching agreement on IPEF in June at the ministerial meeting in Singapore.
India, however, did not formally sign these agreements then as domestic approval processes could not be completed in time due to elections. These agreements will enter into force after at least five IPEF partners complete their internal legal procedures for ratification, acceptance or approval.
IPEF was launched in 2022 and had 14 countries – Australia, Brunei, Fiji, India, Indonesia, Japan, Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, Vietnam and USA.
The framework is structured around four pillars relating to Trade (Pillar I); Supply Chain Resilience (Pillar II); Clean Economy (Pillar III); and Fair Economy (Pillar IV). India has joined Pillars II to IV of IPEF while it has maintained an observer status in Pillar-I.
Agreement on Clean Economy intends to accelerate efforts of IPEF partners towards energy security and transition, climate resilience and adaptation, greenhouse gases emissions mitigation; develop innovative ways of reducing dependence on fossil fuel energy and deployment of clean energy and climate-friendly technologies.
Agreement on Fair Economy seeks to create a more transparent and predictable business environment, promote level playing field for businesses, enhance efforts to prevent and combat corruption, establish confidential systems, improve tax transparency and exchange of information for tax purposes. In November last year the IPEF members signed the Supply Chain Resilience Agreement which has come into force. The next ministerial meeting of IPEF will be held virtually in September.
Source:financialexpress.com