Indo-Pacific Economic Framework for Prosperity (IPEF): Strengthening Regional Cooperation

Introduction

• The Indo-Pacific Economic Framework for Prosperity (IPEF) has recently solidified its commitment to fortify regional supply chains while ensuring strict adherence to labor regulations.

Understanding IPEF

• The IPEF, initiated by United States President Joe Biden on May 23, 2022, is a collaborative effort among 14 partner countries in the Indo-Pacific region. This framework aims to foster cooperation and economic integration, promoting resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness among member economies.

Key Components of IPEF

• Comprising four foundational pillars—trade, supply chain resilience, clean energy, decarbonization, infrastructure, and taxation coupled with anti-corruption measures—the framework seeks to complement existing regional structures and uphold the global rules-based trading system.

Member Countries and Objectives

• Currently, the IPEF includes Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, the United States, and Vietnam. While not structured as a Free Trade Agreement (FTA), it provides flexibility for members to negotiate specific elements.

India’s Participation

• India has actively engaged with the IPEF but has opted out of the trade pillar due to misalignments between the promoted issues and India’s trade policies.

Conclusion

• The IPEF’s commitment to bolstering regional collaboration while addressing various economic facets underscores its significance in shaping a cohesive and sustainable Indo-Pacific economy.