Type: IOCR

India has signalled its readiness to be part of a new economic initiative led Indo-Pacific Economic Framework for Prosperity (IPEF) by the US for the region.

What is IPEF?

• The grouping, which includes seven out of 10 members of the Association of South East Asian Nations (ASEAN), all four Quad countries, and New Zealand, represents about 40% of global GDP.
• The negotiations for the IPEF are expected to centre around four main pillars, including trade, supply chain resiliency, clean energy and decarbonisation, and taxes and anti-corruption measures.
• Countries would have to sign up to all of the components within a module, but do not have to participate in all modules.
• The “fair and resilient trade” module will be led by the US Trade Representative and include digital, labor, and environment issues, with some binding commitments.
• The IPEF seeks to strengthen economic partnership amongst participating countries with the objective of enhancing resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness in the Indo-Pacific region.

Features of IPEF

• US officials made it clear that the IPEF would not be a “free trade agreement”, nor are countries expected to discuss reducing tariffs or increasing market access.
• The IPEF will not include market access commitments such as lowering tariff barriers,
• In that sense, the IPEF would not seek to replace the 11-nation CPTPP (Trans-Pacific Partnership) that the US quit in 2017, or the RCEP, which China, and all of the other IPEF countries (minus the US) are a part of.
• Three ASEAN countries considered closer to China — Myanmar, Cambodia and Laos — are not members of the IPEF.

Four pillars of IPEF

1. Trade that will include digital economy and emerging technology, labour commitments, the environment, trade facilitation, transparency and good regulatory practices, and corporate accountability, standards on cross-border data flows and data localisations;
2. Supply chain resiliency to develop “a first-of-its-kind supply chain agreement” that would anticipate and prevent disruptions;
3. Clean energy and decarbonisation that will include agreements on “high-ambition commitments” such as renewable energy targets, carbon removal purchasing commitments, energy efficiency standards, and new measures to combat methane emissions; and
4. Tax and anti-corruption, with commitments to enact and enforce “effective tax, anti-money laundering, anti-bribery schemes in line with [American] values”.

Reasons for creation of IPEF

• The IPEF is also seen as a means by which the US is trying to regain credibility in the region after former President Donald Trump pulled out of the Trans Pacific Partnership TPP).
• Since then, there has been concern over the absence of a credible US economic and trade strategy to counter China’s economic influence in the region.
• China is an influential member of the TPP, and has sought membership of its successor agreement Comprehensive and Progressive Agreement on Trans Pacific Partnership.
• It is also in the 14-member Regional Comprehensive Economic Partnership, of which the US is not a member (India withdrew from RCEP).
• The Biden Administration is projecting IPEF as the new US vehicle for re-engagement with East Asia and South East Asia.

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In order to check China’s illegal fishing in the Indo-Pacific region, the Quadrilateral Security Alliance (Quad) has planned to launch a satellite-based surveillance initiative.

What is the news?

• The leaders of Quad are reported to be getting ready to unveil a maritime surveillance initiative to protect exclusive economic zones in the Indo-Pacific against environmental damage.

How will the proposed maritime surveillance system work?

• The initiative will use satellite technology to connect existing surveillance centres in India, Singapore and the Pacific.
• This will help establish a tracking system to combat illegal, unregulated and unprotected (IUU) fishing.
• The satellite-enabled dragnet will track IUU fishing activities from the Indian Ocean and South-east Asia to the South Pacific.
• The idea is to monitor illicit fishing vessels that have their AIS (automatic identification system) transponders turned off to evade tracking.
• The move by the Quad security group is also seen to be aimed at reducing the small Pacific island nations’ growing reliance on China.

Why is illegal fishing seen as such a big threat?

• The unregulated plunder of global fishing stock poses a grave threat to the livelihood and food security of millions of people.
• Globally, fish provide about 3.3 billion people with 20% of their average animal protein intake.
• According to an FAO report, around 60 million people are engaged in the sector of fisheries and aquaculture.
• While the economic loss from illegal fishing has been difficult to precisely quantify, some estimates peg it around USD 20 billion annually.

Threats posed by IUU Fishing

• Illegal fishing has now replaced piracy as a global maritime threat.
• In the Indo-Pacific region, like elsewhere, the collapse of fisheries can destabilise coastal nations.
• It poses a much bigger security risk, as it can fuel human trafficking, drug crime and terror recruiting.

Why is China in the dock?

• The 2021 IUU Fishing Index, which maps 152 coastal countries, ranked China as the worst offender.
• China is considered responsible for 80% to 95% illegal fishing in the region after having overfished its own waters.
• It, in fact, is known to incentivise illegal fishing with generous subsidies to meet its growing domestic demand.

China and distant-water fishing (DWF)

• China’s DWF fleet has almost 17,000 vessels and is the largest in the world.
• Vessel ownership is highly fragmented among many small companies and the fleet includes vessels registered in other jurisdictions.

Issues with Chinese IUU Fishing

• Chinese are often accused of pillaging ocean wealth with great sophistication and with little regard for maritime boundaries.
• China also uses them to project strategic influence and to bully fishing vessels from weaker nations.
• China uses destructive practises such as bottom trawling and forced, bonded and slave labour and trafficked crew, alongside the widespread abuse of migrant crewmembers.

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After nearly three months of debate within the two countries, Finland and Sweden have formally applied for membership of the North Atlantic Treaty Organization (NATO).

What is NATO?

• NATO is a military alliance established by the North Atlantic Treaty (also called the Washington Treaty) of April 4, 1949.
• It sought to create a counterweight to Soviet armies stationed in Central and Eastern Europe after World War II.
• Its original members were Belgium, Canada, Denmark, France, Iceland, Italy, Luxembourg, the Netherlands, Norway, Portugal, the United Kingdom, and the United States.
• NATO has spread a web of partners, namely Egypt, Israel, Sweden, Austria, Switzerland and Finland.

Expansion of NATO: Transforming Europe

• The war in Ukraine has already changed the geopolitics of Europe and the world.
• The admission of Finland and Sweden to NATO would bring about a transformation in the continent’s security map by giving NATO a contiguous long frontier in western Russia.
• Finland and Russia share a 1,300-km border — and doubling it from the present 1,200 km, parts of it in northern Norway, Latvia and Estonia, and Poland and Lithuania.
• In addition, Sweden’s island of Gotland in the middle of the Baltic Sea would give NATO a strategic advantage.
• Furthermore, when Sweden and Finland join NATO, the Baltic Sea — Russia’s gateway to the North Sea and the Atlantic Ocean — would be ringed entirely by NATO members.

Why Nordic countries are willing to join NATO?

• Although the debate over joining NATO was ongoing in both countries for nearly three decades, Russia’s annexation of Crimea pushed both towards NATO’s “open door” policy.
• Still, there was little political consensus in either country, especially in Sweden where the Social Democrats have long been against the idea.
• However, February 24 changed everything the date on which Russia invaded Ukraine.

A knee jerk reaction?

• If Putin’s invasion of Ukraine was meant to deter NATO’s eastward expansion, the war has had the opposite effect.
• If admitted, Sweden and Finland will become its 31st and 32nd members.

Russian response

• Back in March, Russia had evoked a threatening response to take retaliatory measures by stationing its nuclear and hypersonic weapons close to the Baltic Sea.
• Russia denounced the problems with Finland and Sweden but the NATO’s expansion at the expense of these countries does not pose a direct threat to us.
• But the expansion of military infrastructure into this territory will certainly provoke their response, warned Mr Putin.
• Sweden had already said it would not allow NATO bases or nuclear weapons on its territory.

Hurdles for Finland, Sweden

• At the moment the main obstacle to their applications in Turkey, a member since 1952 and which has NATO’s second-largest army after the US.
• Turkish president Erdogan has objected to their applications on the ground that the two countries had provided safe haven to the leaders of the Kurdish group PKK.
• Many Kurdish and other exiles have found refuge in Sweden over the past decades.
• PKK is an armed movement fighting for a separate Kurdistan, comprising Kurdish areas in Turkey, Iraq, Iran and Syria.
• Neither of these countries have a clear, open attitude towards terrorist organisation.

What could Turkey gain?

• Turkey is expected to seek to negotiate a compromise deal to seek action on Kurdish groups.
• Erdogan could also seek to use Sweden and Finland’s membership to wrest concessions from the United States and other allies.
• Turkey wants to return to the US-led F-35 fighter jet program — a project it was kicked out of following its purchase of Russian S-400 missile defense systems.
• Alternatively, Turkey is looking to purchase a new batch of F-16 fighter jets and upgrade its existing fleet.

How does this affect Turkey’s image in the West?

• Turkey is reinforcing an image that is blocking the alliance’s expansion for its own profit.
• It also risks damaging the credit it had earned by supplying Ukraine with the Bayraktar TB2 armed drones that became an effective weapon against Russian forces.

Is Turkey trying to appease Russia?

• Turkey has built close relations with both Russia and Ukraine and has been trying to balance its ties with both.
• It has refused to join sanctions against Russia — while supporting Ukraine with the drones that helped deny Russia air superiority.

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