Australia's Minister for Trade, Tourism and Investment Dan Tehan, India's Commerce and Industry Minister Piyush Goyal and Japan's Minister for Economy, Trade and Industry Kajiyama Hiroshi virtually launched the SCRI, which media reports described as an initiative to counter China's dominance on international trade.
China on Wednesday sharply reacted to a trilateral initiative by the trade ministers of India, Japan and Australia to launch the Supply Chain Resilience Initiative (SCRI), saying shifting of industrial chains is against economic laws and disrupts global supply chains.
Australia’s Minister for Trade, Tourism and Investment Dan Tehan, India’s Commerce and Industry Minister Piyush Goyal and Japan’s Minister for Economy, Trade and Industry Kajiyama Hiroshi virtually launched the SCRI, which media reports described as an initiative to counter China’s dominance on international trade.
The SCRI seeks to enhance the resilience of supply chains in the Indo-Pacific region and develop dependable sources of supply and attract investment.
When asked for his reaction to the meeting of the three ministers and the launch of the SCRI, Chinese Foreign Ministry spokesman Zhao Lijian told a media briefing here that the formation and development of global industrial and supply chains are the result of market rules and choice of enterprises.
“The upper and lower reaches of industrial chains have a relationship that is cooperative and for win-win results. It is not a gift from one side to the other, he said.
“Shifting industrial chains is against economic laws and facts. That would be not helpful to solving problems faced by countries and would disrupt global industrial supply chains and they would not be conducive to stability and recovery of the world economy, he said.
“With COVID-19 in place, we hope the relevant parties can value the achievements in international cooperation on fighting the virus, respect market rules and free trade rules, do things that are conducive to mutual trust and cooperation and jointly safeguard the steady and smooth operation of supply and industrial chains to move the world economy towards sustainable, strong, balanced and inclusive growth,” he said.
The trade ministers of India, Australia and Japan have instructed their officials to implement certain steps such as holding investment promotion events and share best practices as part of the SCRI of these three countries, according to a joint statement issued after the meeting.
Noting that some supply chains have been left vulnerable due to a range of factors, the ministers acknowledged that the COVID-19 pandemic had revealed supply chain vulnerabilities globally and in the region. According to a joint statement, which was adopted at the meeting, the ministers instructed their officials to implement certain steps as initial projects of SCRI and further develop the initiative.
The steps include “sharing of best practices on supply chain resilience; and holding investment promotion events and buyer-seller matching events to provide opportunities for stakeholders to explore the possibility of diversification of their supply chains,” it added.
The ministers also decided to convene at least once a year to provide guidance to the implementation of the SCRI as well as to consult on ways to develop the initiative.
“The SCRI aims to create a virtuous cycle of enhancing supply chain resilience with a view to eventually attaining strong, sustainable, balanced and inclusive growth in the region,” it said.
In his speech, Commerce and Industry Minister Piyush Goyal proposed that sharing of information should lead to capacity building, which will further help in making the matching events more result-oriented.
Based on the information that will be shared, he said, officials should map the existing supply chains, identify the gaps and discuss possible options to make them more resilient and efficient so that an outcome with a better score on account of quality, cost, and delivery can be achieved.
“I would like to urge our senior officials to select five products for which a larger part of their supply chains exist in India, identify the gaps therein and then disseminate the related information to the Japanese and Australian companies looking at diversifying or relocating themselves,” the minister added.
Goyal further said that India has announced the PLI schemes worth USD 26 billion covering 13 champion sectors in the next five years to create and nurture manufacturing global champions for an Aatmanirbhar Bharat.
“I would like to invite companies in your countries to utilise these incentives to increase their commercial viability while achieving diversification of supply chains,” he added.