India Strengthens Economic Ties with New Agreements Under IPEF

2024-09-22 14:38:26.464000

During Prime Minister Narendra Modi's visit to the United States, India signed three significant agreements under the Indo-Pacific Economic Framework (IPEF) on September 22, 2024, in Delaware. These agreements focus on Clean Economy, Fair Economy, and a broader IPEF collaboration, aiming to enhance clean energy development, anti-corruption efforts, and tax transparency. The Fair Economy Agreement seeks to create a transparent business environment, facilitating investments for Micro, Small, and Medium Enterprises (MSMEs) and integrating Indian companies into global value chains. A ministerial-level oversight mechanism has also been established to monitor the implementation of these agreements. [0fa629f4]

The IPEF, launched on May 23, 2022, in Tokyo and comprising 14 member countries, aims to create a common set of rules and standards around four pillars: connectivity and digital trade, resilient supply chains, clean energy, and corruption-free fair trade. India has ratified the supply chain resilience agreement in February 2024, which is part of the broader IPEF strategy. [0fa629f4]

In conjunction with these agreements, India has decided to join the cooperative work programme on carbon markets under the IPEF, with the Ministry of Power and the Bureau of Energy Efficiency overseeing India's participation. India is also considering joining the cooperative work programmes on clean electricity and sustainable aviation fuel. The country aims to develop its own carbon market and learn from the experiences of other nations. [ec465f26]

However, concerns have been raised regarding the secrecy of negotiations and potential rigid international commitments that could affect India's domestic regulations. Ajay Srivastava highlighted the importance of ensuring that the agreements do not overly restrict India's policy space or tax revenue generation abilities. A report by the Global Trade Research Initiative (GTRI) suggests that India should avoid a non-derogation clause that would prevent the relaxation of existing domestic rules for projects of national importance. It also advises against agreeing to minimum standards on clean energy products/technologies for domestic markets and stopping preferential treatment to domestic suppliers in government procurement of goods. The GTRI emphasizes the importance of resolving these issues domestically before committing to international obligations. [ad53e9da]

In a related development, Uganda has signed its fourth Country Programme Framework (CPF) with the International Atomic Energy Agency (IAEA) for the period of 2024-2029. The CPF was signed by Hon. Ruth Nankabirwa Ssentamu, Minister of Energy and Mineral Development, and Hua Liu, IAEA Deputy Director General and Head of the Department of Technical Cooperation, on February 16, 2024. The CPF identifies seven priority areas for Uganda, including nuclear and radiation safety, water and the environment, introduction of nuclear power, uranium production, and feasibility studies on industrial applications such as research reactors and industrial irradiators. Uganda has been a member state of the IAEA since 1967. [640b8a6f]

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