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IPEF Ministerial Concludes; India Not in Trade Pillar

India chose not to sign onto the trade pillar in the Indo-Pacific Economic Framework, which focuses on digital trade, trade facilitation, science-based sanitary and phytosanitary rules, trade in environmental goods, and laws to protect labor rights.

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U.S. Trade Representative Katherine Tai did not respond to repeated questions during a press conference Sept. 9 about what concerns India had that made it decide not to participate. She said she wouldn't characterize India's decision as opting out, and said they aren't in the trade pillar "yet."

"We cover the same issues in [our] bilateral channel," she said.

The trade pillar's ministerial statement says the countries all agree to work on effective implementation of the World Trade Organization's Agreement on Trade Facilitation, "facilitating trade through simplified customs procedures and clearance while maintaining customs control; digitalization of trade facilitation measures; addressing logistics and transportation issues, including, in particular, maritime issues, as appropriate; and promoting transparency. We will seek to promote electronic processing of customs data and documentation, and maintain or shape responsible rules on the efficient and trustworthy handling of trader data. In addition, we will seek provisions and initiatives on, inter alia: enhanced publication; electronic payments; perishable goods; and customs cooperation."

Australia, Brunei Darussalam, Fiji, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam are the countries that signed onto the trade pillar.

The countries said they want to advance inclusive digital trade, including "addressing discriminatory practices," and promoting "trusted and secure cross-border data flows."

A reporter asked why language about the "free flow of data" and a prohibition on data localization did not make it into the statement, and asked if this was a departure of a sort. Tai said not to read too much into the words.

The statement also says countries will seek to "avoid unjustified measures that restrict food and agricultural imports; improve transparency of regulatory processes and procedures; advance science- and risk-based decision-making to protect human, animal, and plant life or health; improve processes and promote cooperation regarding regulatory and administrative requirements."

The countries said they will respond to climate change and protect the environment through "effective enforcement of our respective environmental laws and strengthening environmental protection; protection of the marine environment; biodiversity conservation; combatting wildlife trafficking and illegal logging and associated trade; climate change solutions that build on existing commitments, including facilitating trade and investment in relevant clean technologies and environmental goods and services, and enhancing renewable energy, energy efficiency, and zero and low carbon sourcing; ... ."

They also said they will adopt and enforce "national laws based on internationally-recognized labor rights, based on the ILO Declaration on Fundamental Principles and Rights at Work," referring to the International Labor Organization principles.

All the countries signed on to the supply chain pillar. They said they intend to work toward "enabling the identification of sole sources or chokepoints within supply chains; strengthening our industries and supporting trade and investment in critical sectors," and in times of crisis, "facilitate the efficient movement of goods and related essential services in critical sectors." They said they all want to work to improve supply chain logistics.

A reporter asked Tai if, five years after IPEF is concluded, there would be more trade with these Asian countries and less with China. Tai said she doesn't know. But Commerce Secretary Gina Raimondo, whose department is leading pillars on supply chains, clean energy and tax/anti-corruption, replied, "I don't have a crystal ball, but if you think investment drives trade, it's conceivable there will be more trade. I am confident that IPEF will lead to more US capital in the region. I also feel confident in saying IPEF will create jobs in the United States and jobs in the IPEF countries."