Trade ministers of India, Japan and Australia on Tuesday decided to launch an initiave later this year to achieve supply chain resilience in the Indo-Pacific region, a move seen as countering China’s dominance on world trade.
The ministers have asked their officials to urgently work out details of the proposed initiative so that it can be launched early to bolster supply chains. The decision comes at a time when China’s expansionist agenda across the South China sea and its borders with India has unnerved several countries in the region.
“The ministers reaffirmed their determination to take a lead in delivering a free, fair, inclusive, non-discriminatory, transparent, predictable and stable trade and investment environment and in keeping their markets open,” according to a joint statement after the meeting.
Commerce and industry minister Piyush Goyal, Japan’s minister of economy, trade and industry Hiroshi Kajiyama and Australia’s trade, tourism and industry minister Simon Birmingham attended the virtual meeting.
Addressing the meeting, Goyal said the initiave couldn’t have come at a more opportune time in the post-Covid scenario when “there is a likelihood of rechurning of supply chains in the Indo-Pacific region and it’s incumbent on us to take the initiave”, according to a statement by the Indian commerce ministry after the meeting.
While China was not specifically addressed during the meeting on Tuesday, the three ministers did agree that Asean nations would be good candidates to reach out to next, Bloomberg reported, citing Japan’s trade ministry.
Already, India, Japan and Australia make up the Quadrilateral Security Dialogue, or Quad, along with the US, to strengthen national security consultation.
Tuesday’s meeting of trade ministers also comes at a critical juncture when the Covid-19 pandemic has not just posed an unprecedented health crisis but also caused a sharp contraction in economic activities, disrupting trade and investments. The International Monetary Fund (IMF) has predicted a 4.9% contraction for 2020 global GDP, warning that the Covid-19 outbreak has plunged the global economy into its worst recession since the Great Depression in 1930s. The WTO, too, had in April warned that global trade volume growth could crash by 13-32% in 2020.