Sakshi Education
By Srirangam Sriram, Sriram's IAS, New Delhi.
In September 2020, trade ministers of India, Japan and Australia decided to launch an initiative later this year to achieve supply-chain resilience in the Indo- Pacific region.
The RSCI would build resilient supply chains that are either independent or barely dependent on China. The effort follows a fundamental lesson imparted by Covid-19. Supply chains relying excessively on a particular country—China, in this instance— are likely to be severely disrupted during pandemics like Covid-19. The collapse of production within China in the early months of the outbreak of the pandemic caused cracks in several supply chains.
For countries like India, Japan and Australia, whose trade relations with China are deep and exhaustive, and whose producers and consumers are reliant on sourcing from China, the impact was quite damaging. India’s current relations with China are at their lowest ebb in several decades. Australia and Japan are also experiencing various difficulties and discomfort in managing ties with China.
RSCI is an example of how regional supply chains might be repositioning in line with the emerging geopolitics post-Covid-19.
The initiative, currently limited to the government-to-government level, will also involve industries as well as academia of these nations.
The partnership is important, as it currently involves three major players in the Asia- Pacific region, with combined gross domestic product of $9.3 trillion and trade (both goods and services) of $3.6 trillion in 2019.
The move, originally mooted by Japan, gathered speed after the Covid-19 outbreak exposed China’s unreliability as a supplier.
Already, India, Japan and Australia make up the Quadrilateral Security Dialogue, or Quad, along with the US, to strengthen national security consultation.
The three are planning to widen the ambit to include more like-minded countries in the Indo-Pacific region — a move seen as countering China’s dominance in world trade.
The RSCI would build resilient supply chains that are either independent or barely dependent on China. The effort follows a fundamental lesson imparted by Covid-19. Supply chains relying excessively on a particular country—China, in this instance— are likely to be severely disrupted during pandemics like Covid-19. The collapse of production within China in the early months of the outbreak of the pandemic caused cracks in several supply chains.
For countries like India, Japan and Australia, whose trade relations with China are deep and exhaustive, and whose producers and consumers are reliant on sourcing from China, the impact was quite damaging. India’s current relations with China are at their lowest ebb in several decades. Australia and Japan are also experiencing various difficulties and discomfort in managing ties with China.
RSCI is an example of how regional supply chains might be repositioning in line with the emerging geopolitics post-Covid-19.
The initiative, currently limited to the government-to-government level, will also involve industries as well as academia of these nations.
The partnership is important, as it currently involves three major players in the Asia- Pacific region, with combined gross domestic product of $9.3 trillion and trade (both goods and services) of $3.6 trillion in 2019.
The move, originally mooted by Japan, gathered speed after the Covid-19 outbreak exposed China’s unreliability as a supplier.
Already, India, Japan and Australia make up the Quadrilateral Security Dialogue, or Quad, along with the US, to strengthen national security consultation.
The three are planning to widen the ambit to include more like-minded countries in the Indo-Pacific region — a move seen as countering China’s dominance in world trade.Published date : 28 Nov 2020 11:48AM
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