Consumer Protection Act, 2019

Supply Chain Resilience Initiative

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Supply Chain Resilience Initiative

It is the capability of the supply chain of a country to handle any kind of disruption and function normally in difficult times. One approach is diversifying the source of supply across a group of supplying nations instead of being dependent on just one or a few.

Key Points:

Aim: The initiative aims to create a virtuous cycle of enhancing supply chain resilience to attain strong, sustainable, balanced, and inclusive growth in the region.

Meeting: The meeting by the trade ministers of three countries will be convened at least once a year. It will be helpful in the implementation of the SCRI as well as to consult on how to develop the Initiative.

Need: Disruption of supplies from a particular country can happen due to natural calamities such as pandemics or man-made events such as armed conflicts. It can adversely impact the destination country’s economic activities.

Example: Japan imported $169 billion worth from China in 2019 accounting for 24% of its total imports. However, Japan’s imports from China fell by half in February 2020 that impacted Japan’s economic activity.

Focus on sharing 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.


  • 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 in the News?

In a move to counter China’s dominance of the supply chain in the Indo-Pacific region, trade ministers of India, Japan and Australia have formally launched the Supply Chain Resilience Initiative (SCRI).


The Covid-19 pandemic was having an unprecedented impact in terms of lives lost, livelihoods and economies affected, and that the pandemic had revealed supply chain vulnerabilities globally and in the region.

Possible policy measures under the initiative may include:

  • Supporting the enhanced utilization of digital technology.
  • Supporting trade and investment diversification.

Significance to India:

  • Following the border tensions with China, partners such as Japan have sensed that India may be ready for dialogue on alternative supply chains.
  • China still remains a large source of critical imports for India, from mobile phone components to pharmaceutical ingredients. An internal push to suddenly cut links with China would be impractical.
  • Over time, if India enhances self-reliance or works with exporting nations other than China, it could build resilience into the economy’s supply networks.

Need for this initiative:

  • Covid-19 Impact: With the disruption by Covid-19, countries have realized the shortcomings of that dependence over a single nation. Thus, the initiative aims to reduce the dependency on a single nation (at present China).
  • Impact of US-China Trade Tensions: The tariff sanctions imposed on each other during the US-China trade threatened all significant economies heavily reliant on international trade.
  • To counter China’s Influence in the Indo-Pacific Region.


SCRI will help boost India’s manufacturing competitiveness and increase its share in world trade.For this, it needs to create an infrastructure that raises the competitiveness of India’s exports and also needs to accelerate progress in ease of doing business and in skill building.