Widely perceived to be a collective effort to curtail the rapidly expanding influence of China in the Indo-Pacific region, the main idea is to build a supply chain among participants of the framework in order to exclude the Xi Jinping regime and reduce reliance on Beijing.
QUAD Meet: What Is Indo-Pacific Economic Framework & How Does It Concern India?
1. IPEF: The What & Why of It
The seeds of the IPEF were planted in something Biden had said in October last year at the East Asia summit.
"The US will explore with partners the development of an Indo-Pacific economic framework that will define our shared objectives around trade facilitation, standards for the digital economy and technology, supply chain resiliency, decarbonisation and clean energy, infrastructure, worker standards, and other areas of shared interest."
Joe Biden, US PresidentWhile an analysis of the full details is yet to be done, the IPEF appears to be an alternative to the Trans-Pacific Partnership (TPP), which the US quit in 2017 under its former president, Donald Trump.
The IPEF will seek to ensure greater economic engagement (beyond tariffs and market strategy) between countries with respect to the Indo-Pacific region.
The objective would be to establish a platform that would see separate negotiations among participants on varying issues of interest, taking into account their individual demands and needs.
It is also being seen as an economic pivot away from China, even though an official in the US presidential office recently said that the goal is not to make China feel isolated.
The Americans have a strategic interest in anything that involves the Chinese, therefore their interest in the Indo-Pacific, a region that consists of approximately half the population and economic output of the world.
Additionally, the other three QUAD nations – India, Australia, and Japan – are equally worried about China's growing influence in the region.
That is why they are pushing for a democratic, rules-based order that could de facto exclude China from its economic activities, and increase the role of the US in the Indo-Pacific as a more active and reliable economic partner.
Expand2. The Participants
13 countries were a part of the launch of the Indo-Pacific Economic Framework for Prosperity. At the occasion, a joint statement was issued which highlights the key elements envisaged within the IPEF.
Apart from US President Biden, the event was also attended by PM Modi, Japanese Prime Minister Fumio Kishida, as well as virtually by leaders of Australia, Brunei, Indonesia, South Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam.
China has not been invited to be part of the framework, and other nations that have remained out are Cambodia, Laos, and Myanmar.
Despite China's opposition, the number of countries joining the initiative went up from seven to 13, and more are expected to join.
With Monday's launch, partner countries will begin discussions focusing on strengthening economic cooperation and achieving shared goals, India's Ministry of External Affairs said in a statement.
Expand3. What Did India Say at the Launch?
Speaking at the launch, PM Modi said that the IPEF is a declaration of a collective desire to make the Indo-Pacific region an engine of global economic growth.
"India has historically been at the centre of trade flows in the Indo-Pacific region, having the world's oldest commercial port at Lohtal in Gujarat," the Prime Minister said.
He further called for finding common and creative solutions to tackle economic challenges of the Indo-Pacific region.
Expressing India's commitment towards working with all Indo-Pacific countries for an IPEF which is both inclusive and flexible, he further said that the foundation of resilient supply chains must be 3T's: Trust, Transparency, and Timeliness.
Noting that 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, PM Modi also said that 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.
Expand4. India's Concerns About IPEF
Dr Prabir De of the Research and Information System for Developing Countries (RIS), a policy institute based in Delhi, has provided a commentary on why India should be cautious about joining the IPEF.
In a paper titled "Deciphering the Indo-Pacific Economic Framework", he argues that India "would like to avoid risks, as it is not a partner in the ASEAN-led RCEP."
The Regional Comprehensive Economic Partnership is a free trade agreement among 15 Asia-Pacific nations, but India did not join it due to tensions with China and due to its own protectionist set of economic policies.
The risks that De is talking about are the high economic expectations that the US may have from India as a member of the IPEF.
He also argues that "some areas proposed in the IPEF do not appear to serve India's interests."
For instance, with respect to climate and infrastructure, India may not agree with the ambitious decarbonisation targets and goals that will be set by the US.
Similarly, on trade resilience, as Pranab Dhal Samanta argues in The Economic Times, "politically sensitive labour and environment standards could prove to be a challenge for India."
Expand5. 'Keen to Gang Up': China's Reaction
Naturally, China has expressed its displeasure with the potential framework ahead of the QUAD meeting in Tokyo.
Foreign Minister Wang Yi, speaking to reporters in Guangzhou after his talks on Sunday with newly appointed Pakistani Foreign Minister Bilawal Bhutto Zardari, said that the IPEF was "concocted by the United States under the banner of 'freedom and openness'" and Washington was "keen to gang up with 'small circles' and change China's neighbourhood environment," as reported by The Hindu.
He called the framework "a political tool for the US to maintain regional economic hegemony and deliberately exclude specific countries," and asserted that "attempts to create camps, a NATO or Cold War in the Asia-Pacific will not succeed."
(With inputs from South China Morning Post, The Hindu, The Economic Times, The Washington Post, and Reuters.)
(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)
Expand
IPEF: The What & Why of It
The seeds of the IPEF were planted in something Biden had said in October last year at the East Asia summit.
"The US will explore with partners the development of an Indo-Pacific economic framework that will define our shared objectives around trade facilitation, standards for the digital economy and technology, supply chain resiliency, decarbonisation and clean energy, infrastructure, worker standards, and other areas of shared interest."Joe Biden, US President
While an analysis of the full details is yet to be done, the IPEF appears to be an alternative to the Trans-Pacific Partnership (TPP), which the US quit in 2017 under its former president, Donald Trump.
The IPEF will seek to ensure greater economic engagement (beyond tariffs and market strategy) between countries with respect to the Indo-Pacific region.
The objective would be to establish a platform that would see separate negotiations among participants on varying issues of interest, taking into account their individual demands and needs.
It is also being seen as an economic pivot away from China, even though an official in the US presidential office recently said that the goal is not to make China feel isolated.
The Americans have a strategic interest in anything that involves the Chinese, therefore their interest in the Indo-Pacific, a region that consists of approximately half the population and economic output of the world.
Additionally, the other three QUAD nations – India, Australia, and Japan – are equally worried about China's growing influence in the region.
That is why they are pushing for a democratic, rules-based order that could de facto exclude China from its economic activities, and increase the role of the US in the Indo-Pacific as a more active and reliable economic partner.
The Participants
13 countries were a part of the launch of the Indo-Pacific Economic Framework for Prosperity. At the occasion, a joint statement was issued which highlights the key elements envisaged within the IPEF.
Apart from US President Biden, the event was also attended by PM Modi, Japanese Prime Minister Fumio Kishida, as well as virtually by leaders of Australia, Brunei, Indonesia, South Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam.
China has not been invited to be part of the framework, and other nations that have remained out are Cambodia, Laos, and Myanmar.
Despite China's opposition, the number of countries joining the initiative went up from seven to 13, and more are expected to join.
With Monday's launch, partner countries will begin discussions focusing on strengthening economic cooperation and achieving shared goals, India's Ministry of External Affairs said in a statement.
What Did India Say at the Launch?
Speaking at the launch, PM Modi said that the IPEF is a declaration of a collective desire to make the Indo-Pacific region an engine of global economic growth.
"India has historically been at the centre of trade flows in the Indo-Pacific region, having the world's oldest commercial port at Lohtal in Gujarat," the Prime Minister said.
He further called for finding common and creative solutions to tackle economic challenges of the Indo-Pacific region.
Expressing India's commitment towards working with all Indo-Pacific countries for an IPEF which is both inclusive and flexible, he further said that the foundation of resilient supply chains must be 3T's: Trust, Transparency, and Timeliness.
Noting that 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, PM Modi also said that 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 Concerns About IPEF
Dr Prabir De of the Research and Information System for Developing Countries (RIS), a policy institute based in Delhi, has provided a commentary on why India should be cautious about joining the IPEF.
In a paper titled "Deciphering the Indo-Pacific Economic Framework", he argues that India "would like to avoid risks, as it is not a partner in the ASEAN-led RCEP."
The Regional Comprehensive Economic Partnership is a free trade agreement among 15 Asia-Pacific nations, but India did not join it due to tensions with China and due to its own protectionist set of economic policies.
The risks that De is talking about are the high economic expectations that the US may have from India as a member of the IPEF.
He also argues that "some areas proposed in the IPEF do not appear to serve India's interests."
For instance, with respect to climate and infrastructure, India may not agree with the ambitious decarbonisation targets and goals that will be set by the US.
Similarly, on trade resilience, as Pranab Dhal Samanta argues in The Economic Times, "politically sensitive labour and environment standards could prove to be a challenge for India."
'Keen to Gang Up': China's Reaction
Naturally, China has expressed its displeasure with the potential framework ahead of the QUAD meeting in Tokyo.
Foreign Minister Wang Yi, speaking to reporters in Guangzhou after his talks on Sunday with newly appointed Pakistani Foreign Minister Bilawal Bhutto Zardari, said that the IPEF was "concocted by the United States under the banner of 'freedom and openness'" and Washington was "keen to gang up with 'small circles' and change China's neighbourhood environment," as reported by The Hindu.
He called the framework "a political tool for the US to maintain regional economic hegemony and deliberately exclude specific countries," and asserted that "attempts to create camps, a NATO or Cold War in the Asia-Pacific will not succeed."
(With inputs from South China Morning Post, The Hindu, The Economic Times, The Washington Post, and Reuters.)
(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)