International Relations

IPEF: India to Join US-Led Cooperative Programme on Carbon Market

  • India has opted to take part in one of four cooperative work programmes launched under the Indo Pacific Economic Framework’s ‘Clean energy pillar’.
  • India will join the cooperative working group on carbon markets, led by the Ministry of Power. 

What is the Indo-Pacific Economic Framework (IPEF)?

  • It is a US-led project aimed at improving the Indo-Pacific region’s resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness through stronger economic partnerships among participants.
  • The IPEF was founded in 2021 with a dozen first partners representing 40% of global GDP.
  • The IPEF is not a Free Trade Agreement (FTA), although members can negotiate the areas they want to.

Members Countries include:

  • India is currently a member, together with 13 other Pacific Ocean countries: Australia, Brunei, Fiji, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, the United States, and Vietnam.

How does IPEF differ from other trade agreements?

  • The IPEF does not include market access or tariff reductions, but experts believe it can open the road for trade accords.
  • It is not a take-it-or-leave-it agreement, as most global trade treaties are.
  • Because the IPEF is not a standard trade agreement, members are not yet compelled by all four pillars, despite being signatories. 

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