India to skip digital, trade talks at IPEF

The Biden Administration’s signature Indo-Pacific Economic Framework (IPEF) got off to a steady, if unremarkable, start at the first ministerial meeting of the 14-nation grouping held in Los Angeles last week. India, represented by union minister Piyush Goyal, agreed to join discussions on supply chains, decarbonization and anti-corruption but opted out of talks on digital economy and trade.

In an age where China’s economic dominance has grown steadily, IPEF hopes to bind a diverse group of the Indo-Pacific’s largest and most dynamic economies together to frame trade and technology rules, boost trade and secure the region’s economic future. New framework is grouped around four main pillars: trade and digital economy, supply chains, decarbonization & anti-corruption measures. First, and most challenging from India’s perspective, goes by the name of “Connected Economy” and seeks to shape regional economics through “high-standard, inclusive, free, fair, and open trade commitments”, according to the ministerial statement released. The first pillar is expansive in its aims and seeks to harmonize approaches to environmental protections, labour laws and digital economy as well as trade facilitation measures.

Of the 14 nations that form a part of IPEF, India is the only country not to join first pillar. New Delhi’s reasons stem partly from India’s well-established disagreements with the US over data localization and the flow of data. “India is still in the process of deciding what kinds of data can be allowed to cross borders freely and what kinds need to be kept on servers in the country,” said Jayant Dasgupta, former Indian Ambassador to WTO.