India has decided to stay out of the joint declaration on one of the four pillars or the trade pillar of the U.S.-led Indo-Pacific Economic Framework (IPEF), informed Union Commerce Minister Piyush Goyal, who was in Los Angeles for the ministerial meet of the framework on Saturday. Besides other reasons for staying on the fence, Mr. Goyal cited concerns over possible discrimination against developing economies.
India was the only one of the 14 IPEF countries, which include South East Asian countries, Australia, New Zealand, South Korea and Japan, not to join the trade declaration.
The talks regarding the Economic Framework were launched by the IPEF leaders, including Prime Minister Narendra Modi, on the sidelines of the Quad Summit in Tokyo in May. The initiative led by United States President Joe Biden with countries in the Indo-Pacific region is trying to bring them on board with the idea of an alternative trading arrangement resting on four pillars- connected economy (digital trade, data flows), resilient economy, clean economy, and fair economy.
A government statement after the meet said India had “engaged exhaustively” on all the four pillars, and was “comfortable” with the outcome statements on the other three pillars (besides trade): supply chains, clean economy (clean energy) and fair economy (tax and anti-corruption).
From the perspective of developing countries, Mr. Goyal said: “We have to see what benefits member countries will derive and whether any conditionalities on aspects like environment may discriminate against developing countries, who have the imperative to provide low-cost and affordable energy to meet the needs of our growing economy.”
He explained staying out of the trade pillar by stating that the specific “contours of the framework” had not emerged yet, while also pointing out that the government was still firming up its data protection and privacy laws.
India’s move mirrors its decision to walk out after seven years of negotiations from the Regional Comprehensive Economic Partnership (RCEP), a grouping resembling the IPEF that includes China but doesn’t include the U.S. A government statement pointed out, however, that India had not walked out of the IPEF talks, and that delegations would continue to participate.
The report on India’s decision to sit out on the trade pillar of IPEF appears on the front page of The Hindu because the country's membership of the IPEF would keep it in the room on Asian trading arrangements, and would be a way of blunting criticism that it is overtly protectionist. However, its cautious stance also stems from the fact that the agreement is still vague and it is yet to be seen, as the Prime Minister pointed out in May, how inclusive the process will be.
Was this newsletter forwarded to you? Head over to our newsletter subscription page to sign up for Editor‘s Pick and more. Click here
The Hindu Explains
In Frames
Roar of the regatta: Boat races are back in full energy and rhythm on the backwaters of Kerala
The Hindu’s Daily Quiz
Tata Motors is planning to introduce an electric version of which of its cars?
- Altroz
- Tiago
- Harrier
- Punch
To find out the answer and play the full quiz, click here
