India, the US and 12 nations of IPEF have announced the conclusion of negotiations for the proposed clean economy agreement to urge members to take steps for mitigating greenhouse gas emissions and promoting sustainable livelihoods. According to a joint statement from IPEF partner nations, the member countries will now undertake the necessary steps, including further domestic consultations and a legal review, to prepare the final texts of the agreement.
Once finalised, the proposed agreement will be subject to IPEF partners' domestic processes for signature, followed by ratification, acceptance, or approval. "Today, the 14 IPEF partners announced the substantial conclusion of the negotiations of the IPEF Clean Economy Agreement, the IPEF Fair Economy Agreement, and the Agreement on the Indo-Pacific Economic Framework for Prosperity at the IPEF Ministerial Meeting in San Francisco, California," the joint statement said.
Through the clean economy agreement, the member countries are committed to actively pursuing their shared climate objectives and respective pathways to net-zero emission economies, while ensuring the promotion of sustainable growth, it added. "To that end, the proposed agreement covers a range of issues critical to transitions to clean economies, including efforts towards energy security and transition, climate resilience and adaptation, greenhouse gas emissions mitigation, and the promotion of sustainable livelihoods and just transition," the statement said.
Through the cooperative efforts contemplated under the agreement, the IPEF partners intend to accelerate the research, commercialisation, accessibility, affordability, and deployment of a diverse set of clean energy and climate-friendly technologies; and advance sustainable agricultural practices through innovative policies, tools, and technologies, to reduce emissions and increase productivity, it noted.
As per the proposed pact, the 14 countries intend to reduce the climate impact of the transportation sector, including through efforts related to the establishment of green shipping corridors, increasing the production and availability of sustainable aviation fuels, and decarbonising the road sector, including a vehicle fleet that supports zero emission transport. Besides, it has proposed to bolster the supply of and demand for low- or zero-emissions goods and services, including by working closely with the private sector, reducing potential non-tariff barriers, providing greater clarity and certainty in business environments, or promoting fiscal incentives; and working together on issues like carbon credit certification standards.
"The IPEF partners also seek to increase investment flows to the region to address the acute need for financing for climate-related infrastructure, technologies, and projects in support of their transitions to clean economies," it said. To that end, the proposed agreement includes commitments to increase the flow of investments through measures that will boost investor confidence in the region like promoting sustainable finance; fostering innovative financial mechanisms; and working towards a stable and more seamless regulatory and policy environment.
It also proposed to mobilise and expand access to financing, including by deploying concessional capital, guarantees and risk insurance, and technical assistance consistent with robust labour rights and environmental protection. "As part of these efforts, the IPEF partners will convene an annual IPEF Clean Economy Investor Forum, with the first meeting taking place in Singapore in the first half of 2024, to catalyse investment for sustainable infrastructure and climate technology," it said.
IPEF was launched jointly by the US and other partner countries of the Indo-Pacific region on May 23 last year in Tokyo. The framework is structured around four pillars relating to trade, supply chains, clean economy and fair economy (issues like tax and anti-corruption). India has joined all the pillars except the trade.
Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, the US and Vietnam are members of the bloc. Together, they account for 40 per cent of the world's economic output and 28 per cent of trade.
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