SCRI aims to reduce dependence on Chinese markets for finished goods and medical supplies during the pandemic.
The three countries had initially met in September last year to discuss the prospects of trade diversification, with the aim of reducing their dependence on Chinese markets for finished goods and medical supplies during the pandemic.
The development also follows China dropping India from its South Asian Covid action plan.
Acknowledging the “vulnerabilities” of “supply chains globally and in the region”, the trio has now decided to overcome the challenges by strengthening joint business projects through SCRI.
“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. The ministers consented that expansion of the SCRI may be considered based on consensus, if needed, in due course," the three trade ministers said in a joint statement.
The SCRI seeks to enhance the resilience of supply chains in the Indo-Pacific region and develop dependable sources of supply and attract investment, they said. The initiative was discussed during a meeting between 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 in a virtual meeting on Tuesday.
According to a joint statement, which was adopted in 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.
“India wants to use the SCRI to bolster its own economic initiatives and keep leverage when negotiating the revision of the India-Asean FTA,” said Gurjit Singh, former Indian Ambassador to Germany. “Guidelines on how SCRI will function are expected to emerge... Connectivity and standards may be a focus of this. These will help in creating B2B collaboration,” he wrote in a column for The Hindu.
The three trade ministers also noted that some supply chains have been left vulnerable due to a range of factors, acknowledging that the COVID-19 pandemic had revealed major supply chain criticalities globally and in the region. Accordingly, they 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.