Supply Chain Resilience initiative

India, Australia, and Japan initiative on supply chain resilience (it was first proposed by Japan) and invited like-minded countries in the Indo-Pacific region to join the initiative.

• helps a country to ensure that it has diversified its supply risk across a clutch of supplying nations instead of being dependent on just one or a few.
• Unanticipated events — whether natural, such as tsunamis, earthquakes or even a pandemic; or manmade, such as an armed conflict in a region — that disrupt supplies from a particular country or even intentional halts to trade, could adversely impact economic activity in the destination country

Why focus on SCRI?

• COVID-19 Impact: If supply chains are heavily dependent on supplies from one country, the impact on importing nations could be crippling if that source stops production for involuntary reasons, or even as a conscious measure of economic coercion
• U.S.-China trade tensions: threaten globalization as a whole and have a major impact on countries like India, Japan and Australia which are heavily reliant on international trade both for markets for its exports and for supplies of a range of primary goods.
• Managing supply of inputs: Diversification of supply chain is critical and will help to cohesively react to adverse events faster and also to disciplining price volatility.
• Fraying trade and diplomatic relations with China: India restricted some Chinese imports and banned several Chinese apps after a deadly border clash. In Australia, exports like beef, barley and now wine has been targeted by China amid deteriorating ties between the two nations.
• Enhanced cooperation among partner countries: In 2019, cumulative GDP of 3 countries was $9.3 trillion, and their merchandise goods and services trade was $2.7 trillion and $0.9 trillion, respectively. Australia, Japan and India are already part of Quadrilateral Security Dialogue with US.
• Initiate rechurning of supply chains in Indo-Pacific region: SCRI can work with ASEAN to build stronger supply and manufacturing chains that are protected from external shocks and influences.