What is Supply Chain Resilience Initiative (SCRI)?
India, Japan and Australia have begun discussions on launching a trilateral Supply Chain Resilience Initiative (SCRI) to reduce dependency on China, necessitated by Beijing’s aggressive political and military behaviour.
Supply Chain Resilience Initiative
In the context of international trade, supply chain resilience is an approach that helps a country to ensure that it has diversified its supply risk across a clutch of supplying nations.
- To attract foreign direct investment to turn the Indo-Pacific into an “economic powerhouse”
- To build a mutually complementary relationship among partner countries.
- To work out a plan to build on the existential supply chain network.
Why this Initiative?
- With spread of Covid-19, countries have realized that dependence over a single nation is not good for both global economy and national economies.
- USA-China Trade Tensions, where both applied tariff sanctions on each other.
- India as an Emerging Supply Hub: The businesses have started seeing India as a “hub for supply chains”.
- Initiative would be a counter to China’s expansionist approach.
- India is carrying forward the sentiments of self-reliance focusing on less dependence on China which is one of the reasons behind SCRI.
Thus, the initiative aims to reduce the dependency on a single nation (at present China). SCRI is a direct response to individual companies and economies concerned about Chinese political behavior and the disruption that could lead to the supply chain.
Category: International Current Affairs
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