Asia-Pacific Economic Cooperation (APEC)

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Asia-Pacific Economic Cooperation (APEC)

GS- II >> International Relations >> Regional Grouping

Context: The Asia-Pacific Economic Cooperation (APEC) grouping is meeting in San Francisco in the United States for the Leaders’ Week (November 11 to November 17, 2023).

About APEC:

• Founding and purpose: Established in 1989, the Asia-Pacific Economic Cooperation (APEC) serves as a regional economic forum. The primary goal is to enhance regional economic integration and foster prosperity across the Asia-Pacific region.
• Member economies: Comprising 21 economies, APEC includes nations like the United States, China, Japan, Russia, and others. Unique to APEC, Taiwan and Hong Kong participate as distinct entities, emphasizing its economic focus.
• Advocacy of Free Trade: APEC has championed free trade, tariff reduction, and economic liberalization. The Seoul Declaration in 1991 highlighted the ambition to establish a liberalized free trade area around the Pacific Rim.
• Economic impact: APEC initiatives contributed significantly to dynamic growth, fostering a growing middle class in the Asia-Pacific. APEC economies represent 60% of global GDP and 48% of global trade.

• Highlight of APEC Summit 2023:

  • Biden-Xi Meeting: US President Joe Biden and China’s President Xi Jinping’s in-person meeting amid US-China tensions takes centre stage.
  • Focus on Trade Relations: With US-China relations strained, trade-related issues are major points of discussion, reflecting the prolonged tensions.
  • Indo-Pacific Economic Framework (IPEF): President Biden aims to highlight progress on the IPEF, initiated after the US withdrawal from the Trans-Pacific Partnership.

  India and APEC Membership:

  • Membership request: India formally requested APEC membership, garnering initial support from key economies like the United States, Japan, Australia, and Papua New Guinea.
  • Geographical constraint: India’s bid faced a hurdle as APEC traditionally consists of economies bordering the Pacific Ocean. This geographical constraint led to reservations about India’s eligibility for full membership.
  • Observer status: Despite not securing full membership, India was granted observer status in 2020, marking its increased engagement with the forum.
  • Benefits for India: Joining APEC would offer India enhanced integration with the global economy, given APEC’s status as a crucial trading bloc. It could empower India in negotiations and collaborations within the Asia-Pacific region.
  • Potential benefits for APEC: APEC, in accepting India, would gain access to a significant market for labour, consumers, and investments.
  • India’s inclusion could provide a counterbalance to unilateral economic ambitions in the region and align APEC with the evolving concept of the ‘Indo-Pacific.’
  • India’s presence: India’s Union Minister for Commerce and Industry, Piyush Goyal, participates in the forum despite India not being a member, showcasing active engagement.

  Way forward:

  • Diplomatic engagement: India should continue diplomatic efforts to showcase the strategic and economic benefits of its APEC membership.
  • Engaging with member economies and addressing concerns about geographical constraints can strengthen its case.
  • Regional collaboration: Emphasizing the shared goals of regional stability, economic growth, and inclusive development can enhance India’s appeal as a valuable partner within the APEC framework.
  • Customized cooperation: Proposing specific areas of collaboration where India can contribute significantly to APEC objectives, such as technology, innovation, and sustainable development, can make its inclusion more compelling.
  • Trade and economic reforms: Undertaking internal reforms to align with APEC’s principles of free and open trade can demonstrate India’s commitment to the forum’s core values, making it a more attractive candidate for membership.
  • Observer participation: Actively participating as an observer, India can leverage this status to showcase its commitment to APEC’s goals, build rapport with member economies, and gradually pave the way for full membership.
  • Strengthening Indo-Pacific Relations: India should intensify efforts to align its foreign policy with the evolving dynamics, demonstrating how its inclusion in APEC contributes to the broader Indo-Pacific narrative.
  • Public Diplomacy: Engaging in public diplomacy campaigns to raise awareness about the benefits of India’s APEC membership can garner support from within the country and showcase the positive impact on India’s economic and strategic interests.

Source: indianexpress.com