India joins 3 pillars of the US led Indo-Pacific Economic Framework (IPEF)

Tags: Economy/Finance International News

India has decided not to join the trade pillar of the United States-led Indo-Pacific Economic Framework (IPEF) for now but has agreed to join the other three pillars: supply chains, tax and anti-corruption and clean energy.

IMPORTANT FACTS -

• This was declared by the Union Commerce and Industry Minister Piyush Goel at the end of the trade ministers first in person meeting of the IPEF, held in Los Angeles, United States on 9 September 2022.

Why India has not joined the Trade pillar :

• The Minister said that the trade pillar which deals with trade requires commitment of the member countries on environment, labour, digital trade, and public procurement.
• He said that India is not certain what benefit it will get by joining this trade pillar.
• He expressed the fear that the trade pillar may set high standards of compliance which may discriminate against the developing countries.
• Giving an example he said that the United State has set a high standard on environment protection which is applicable on the energy companies. It has set stringent norms for power plants so that they are low polluting and more environment friendly. This mandates investment in new technology which makes the power produced costly.
• If India follows the US standards then it will adversely impact India’s economic development. India needs cheap power so that it is accessible to all. It cannot afford costly powers.
• Similar concerns are also there in the field of labour, digital trade, and public procurement.