IPEF announces action plan to ensure global supply chain resilience

The Indo-Pacific Economic Forum (IPEF) for Prosperity has announced the setting up of separate teams for implementing action plans to ensure resilient supply chains for semiconductors, critical minerals for batteries and chemicals.

The forum also announced the formation of a sub-committee on logistics and movement of goods and another sub-committee to analyse data on supply chain exposures and risk.

The decision comes after successive rounds of meetings and panel discussions by representatives from member countries, including India, on crisis response network and the creation of a dedicated supply chain center and development of the tool like SCALE as proposed by the United States.

The Supply Chain Council of the IPEF, with the US as the chair and India as the vice chair, also adopted the work plan detailing the action to be taken for the year ahead. 

Besides, the partner countries have agreed to establish another team to finalize action plan related to healthcare and pharma sector, which were selected from a list of critical sectors and key goods notified by the partner countries. Membership is not mandatory and interested countries can join the action plan teams within a month of the establishment of the teams. 

Once formed, these action plan teams will be tasked with the job of preparing its recommendations on bringing resilience to supply chains in critical sectors through collaborative and co-operative efforts.

The formation of action plan teams will be based on the relative strengths of partners in the areas including skilled workforce, capital for investment in manufacturing, infrastructure etc.

There is a felt need to secure reliable supply of critical minerals that are basic to effective functioning of sectors like clean energy, electronics, defence, transportation, telecommunications, fertilisers, pharmaceuticals etc. 

However, the concentration of such minerals in certain geographies and global market dynamics can cause price volatility and supply disruptions. Hence the need to address these challenges collectively.

The 14-member IPEF, a grouping of countries in the Indo-Pacific region, gave effect to the Supply Chain Resilience Agreement on 24 February 2024. With three institutionalised groups like Supply Chain Council (SCC), Crisis Response Network (CRN) and the Labour Rights Advisory Board (LRAB), the agreement seeks to strengthen supply chains through economic engagement among partner countries.