The Eastern Economic Forum and India’s balancing act

GS paper 2

Syllabus: Bilateral, regional and global groupings involving India and affecting India’s interests etc

 

Directions: Important for Prelims and mains, you can use it as an example in mains for India’s balancing nature by being part of multiple forums

Source: The Hindu

Context: Russia hosted the seventh Eastern Economic Forum (EEF) Vladivostok.

• • • The forum is a platform for entrepreneurs to expand their businesses into Russia’s Far East (RFE).

What is the Eastern Economic Forum?

• • • It was established in 2015 to encourage foreign investments in the RFE.
    • The EEF displays:
      • Economic potential
      • Suitable business conditions
      • Investment opportunities in the region.
    • The agreements focus on:
      • Infrastructure
      • Transportation projects
      • Mineral excavations
      • Construction
      • Industry
      • Agriculture

Who are the major investors in the Forum?

China:

• • • China is the biggest investor in the region as it sees potential in promoting the Belt and Road Initiative and the Polar Sea Route in the RFE.
    • China’s investments in the region account for 90% of the total investments.
    • China is also looking to develop its Heilongjiang province which connects with the RFE.

South Korea:

It has invested in:

• • • Shipbuilding projects
    • Manufacturing of electrical equipment
    • Gas-liquefying plants
    • Agricultural production and fisheries.

Japan:

• • • It has identified eight areas of economic cooperation and pushed private businesses to invest in the development of the RFE.

India:

• • • India is keen in:
      • cooperation in energy
      • pharmaceuticals
      • maritime connectivity
      • healthcare
      • tourism
      • diamond industry
      • Arctic
    • In 2019, India also offered a $1 billion line of credit to develop infrastructure in the region.

Aim of EEF:

• • • FDI: To increase the Foreign Direct Investments in the RFE.
    • Rich resources: To harness rich natural resources such as fish, oil, natural gas, wood, diamonds and other minerals.
    • Connect: The Russian government’s aim of connecting Russia to the Asian trading route.

A balance between the EEF and the Indo-Pacific Economic Framework(IPEF):

• • • Investment in EEF: India has not shied away from investing in the Russia-initiated EEF despite the current international conditions.
    • Acceptance to IPEF: India has given its confirmation and acceptance to three of the four pillars in the IPEF.

Importance of IPEF for India:

• • • Ideal opportunity for India to act in the region: without being part of the China-led Regional Comprehensive Economic Partnership or Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
    • Disengage from Supply Chains: It will help in disengaging from supply chains that are dependent on China and will also make it a part of the global supply chain network.
    • New sources of raw materials and other essential products: It will further reduce India’s reliance on China for raw materials.

Indo-Pacific Economic Framework (IPEF):

 It was announced in 2021 to set regional standards for cooperation and to encourage regional economies to “decouple” from the Chinese market by leading them to alternative supply chains.

 

Insta Links:

IPEF

 

Mains Links:

Q.What is the significance of Indo-US deals over Indo-Russian defence deals? Discuss with reference to stability in the Indo-Pacific region. (UPSC 2020)

 

Prelims Links:

• • • EEF
    • IPEF
    • BRI
    • Arctic Ocean