Indo-Pacific Economic Framework for Prosperity (IPEF)

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About Indo-Pacific Economic Framework for Prosperity (IPEF)

It is a regional arrangement to build cooperation and economic integration in the Indo-Pacific region.
It was launched by United States President Joe Biden on May 23, 2022.
This framework is intended to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for member economies.
IPEF will seek to complement and build on existing regional architecture and support the global rules-based trading system.
It currently includes 14 partner countries: Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, the United States, and Vietnam.
The economic framework broadly rests on four pillars:
- Trade
- Supply chain resilience
- Clean Energy, Decarbonization, and Infrastructure
- Taxes and anti-corruption measures
The IPEF is not a Free Trade Agreement (FTA), but allows members to negotiate the parts they want to.
Indian and IPEF:
- India has been actively participating in the IPEF, but not in all pillars.
- India has decided to opt out of the trade pillar of the IPEF as most issues promoted by the IPEF do not align with India’s trade policies.

Q1) What is a Free Trade Agreement (FTA)?

A free trade agreement is a pact between two or more nations to reduce barriers to imports and exports among them. Under a free trade policy, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.

Source: IPEF inks deal to boost supply chain