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India signed and exchanged first-of-its-kind agreements focused on the Clean Economy and Fair Economy under the Indo-Pacific Economic Framework (IPEF) on Saturday, during Prime Minister Narendra Modi's three-day visit to the United States for the Quad Summit.
According to the Ministry of Commerce and Industry, the IPEF Clean Economy Agreement aims to foster technical cooperation, workforce development, and research collaborations among member nations. Its primary goal is to promote clean energy and climate-friendly technologies, accelerating the collective efforts of IPEF partners towards energy security, climate resilience, and reducing greenhouse gas emissions. This agreement is set to facilitate investments and project financing, particularly targeting Micro, Small, and Medium Enterprises (MSMEs). Key initiatives will include the establishment of joint collaborative projects, the IPEF Catalytic Capital Fund, and the IPEF Accelerator. These programmes are designed to enhance the integration of Indian companies into global value chains, particularly within the Indo-Pacific region. The Fair Economy Agreement focuses on creating a transparent and predictable trade and investment landscape across the Indo-Pacific. IPEF partners will collaborate to combat corruption and improve tax transparency, emphasising the exchange of information and enhancing tax administration. This agreement aims to strengthen cross-border investigations and prosecutions, supporting India's initiatives against corruption, money laundering, and terrorism financing. Technical assistance and capacity building are integral to the agreement, ensuring effective implementation of anti-corruption measures and improving the efficiency of tax systems. In addition to the specific agreements, an overarching IPEF agreement was signed to establish a ministerial-level oversight mechanism. This administrative framework will provide guidance and goals for the various IPEF agreements, enhancing cooperation among member nations and ensuring effective implementation. The Union Cabinet, led by PM Modi, approved these agreements earlier this month, paving the way for India's formal participation, which was initially delayed due to domestic approval processes. Under the Clean Economy (Pillar-III) Agreement, IPEF partners are working to stimulate investment in green technologies and lower greenhouse gas emissions through various initiatives, including annual business matching events held at the Investor Forum. The inaugural Investor Forum took place in Singapore on June 5-6, 2024. During this event, a Memorandum of Understanding (MoU) was established among companies from India, Singapore, and Japan, leading to Singapore-based Sembcorp's commitment to invest Rs 36,238 crore in a cutting-edge green ammonia plant in Thoothukudi. At the Forum, IPEF partners identified priority infrastructure projects worth USD 23 billion (Rs 1.91 lakh crore), including around USD 4 billion (Rs 33,200 crore) from India, highlighting investment opportunities in Indian renewable energy firms. The United States International Development Finance Corporation (DFC) pledged USD 1.5 billion (Rs 12,450 crore) to support energy transition, climate investments, and digital inclusion. The IPEF also offers platforms for technical assistance, concessional funding, and viability gap funding. The IPEF Catalytic Capital Fund, which received an initial grant of USD 33 million (Rs 273.9 crore) from Australia, Japan, Korea, and the United States, aims to leverage private investments totalling USD 3.3 billion (Rs 27,390 crore). Additionally, the PGI Investment Accelerator under IPEF has secured initial funding of USD 300 million (Rs 2,490 crore) from the DFC. The IPEF also offers platforms for technical assistance, concessional funding, and viability gap funding, including the IPEF Catalytic Capital Fund and the PGI Investment Accelerator. Among the key initiatives launched under IPEF is the Upskilling Initiative, which aims to provide digital skills training primarily to women and girls in emerging and middle-income partner countries. India has benefitted from 4 million of the 10.9 million upskilling opportunities provided in the last two years. The Critical Mineral Dialogue focuses on mapping mineral resources and promoting sustainable mining practices, while the Tech Council aims to enhance cooperation on critical technologies such as cyber security and artificial intelligence. The Cooperative Work Programme (CWP) has already proposed eight initiatives related to hydrogen supply chains, carbon markets, and clean electricity, including India's proposal on e-waste urban mining. (ANI)
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