Context:

Recently, under the Supply Chain Resilience Agreement (SCRA), a Supply Chain Council (SCC) has been set up with the US as Chair and India as Vice-Chair.

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• India signed the Supply Chain Resilience Agreement (Pillar-II) in November 2023 under the Indo-Pacific Economic Framework for Prosperity (IPEF).
• The SCRA (Pillar-II) came into force in February 2024.

About SCRA and India

• Article 6.10 of SCRA encourages private sector involvement to enhance supply chain efficiency, resilience, productivity, and sustainability.
• The Agreement focuses on improving supply chain resilience, especially in critical sectors for national security and economic stability.
• Article 10 of SCRA emphasizes identifying critical sectors or key goods for national security, public health, or economic stability.
• India is working with stakeholders such as industry, academia, and experts to identify these critical sectors.

About Supply Chain Council 

The 14 IPEF members have established 3 bodies under SCRA. These are – 

• Supply Chain Council (SCC), 
• Crisis Response Network (CRN), and 
• Labor Rights Advisory Board (LRAB)

The SCC was formed to pursue targeted, action-oriented work to strengthen the supply chains for those sectors and goods most critical to national security, public health, and economic well-being. 

In September 2024, the first SCC meeting in Washington led to the formation of Action Plan Teams focusing on key areas such as Semiconductors, Critical Minerals, and Chemicals. 

About IPEF 

The Indo-Pacific Economic Framework for Prosperity (IPEF) was launched on May 23, 2022, in Tokyo, Japan. 

IPEF has 14 members (including India) and represents about 40% of global GDP and 28% of global trade.

• 14 partner countries – Australia, Brunei, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, Vietnam and the USA. 

IPEF aims to enhance economic cooperation among these countries to promote growth, economic stability, and prosperity in the Indo-Pacific region.

The framework is structured around four pillars:  

• Pillar I – Fair & Resilient Trade 
• Pillar II – Supply Chain Resilience 
• Pillar III – Clean Economy 
• Pillar IV – Fair Economy 

India has joined Pillars II to IV of IPEF while it maintains an observer status in Pillar I.

• India joined Pillar II in November 2023, which has been in force since February 2024.
• India joined Pillar III, Pillar IV, and the IPEF Overarching Agreement during the Prime Minister’s visit to the USA in September 2024.