Should Bangladesh join the US-led IPEF?

US President Joe Biden, Japan’s Prime Minister Fumio Kishida, and Indian Prime Minister Narendra Modi attend the Indo-Pacific Economic Framework for Prosperity with other regional leaders on May 23, 2022. PHOTO: BLOOMBERG

In October 2021, Joe Biden announced the US plan to launch a new economic bloc in the Indo-pacific region. Later, on May 23, 2022, the United States along with 12 other countries from the Asia Pacific region, officially unveiled the Indo-Pacific Economic Framework (IPEF). Initial participants in the framework include Australia, India, Japan, South Korea, Indonesia, the Philippines, Malaysia, Thailand and Vietnam, Brunei, New Zealand and Singapore.

After the Trump administration's woeful withdrawal from the Trans-Pacific Partnership (TPP) in 2017,  the Indo-Pacific Strategy (IPS)- the geostrategic bedrock of US containment policy against China- was struggling. 

Moreover, from the very beginning of his presidency, Biden's global diplomatic endeavour has been characterised by the 'diplomacy without due commitment' to economic resources. 

To address the missing economic link to its broader strategic set-up and seemingly to refurbish his diplomatic profile, the US president has kicked off the economic framework christened as Indo-Pacific Economic Framework (IPEF).

While stating Bangladesh's strategic orientation to and probable future posture in Indo-Pacific Strategy (IPS), Foreign Minister Dr AK Abdul Momen said, "We're sure that we'll be effectively engaged in any future 'Indo-Pacific Alliance' if it is found to be purely economic in nature." 

For Bangladesh, before delving deep into this question, it is worth contemplating some underlying questions concerning the very aspects of IPEF: is the IPEF economic in nature, and if so, how much? Or is it just another US geopolitical avenue under an economic fig leaf in its strategic rivalry with China? And if so, how strategically viable is it for Bangladesh to be embroiled in such a power struggle?

Firstly, the Indo-Pacific Economic Framework consists of four modules covering fair and resilient trade rules, supply chain resilience, infrastructure and green technology, tax and anti-corruption. 

It is a non-traditional economic arrangement, dealing with high-standard trade and manufacturing rules and regulations like ambitious labour standards, sweeping supply chain decarburisation, data localisation guidelines, etc. The IPEF has no binding commitments in terms of market access or tariff concession.

As per the White House fact sheet, while it says- "IPEF will enable the United States and our allies to decide on rules of the road that ensure American workers, small businesses, and ranchers can compete in the Indo-Pacific," the IPEF is neither an economic "pact nor a deal". Rather it is a loose framework aiming at serving the US interests at the high compliance costs for the regional countries. So in a nutshell, the IPEF is all about sticks with no carrots in exchange.

So, given the country's quasi-autarkic nature of the economy, fledgling economic infrastructure, post-pandemic urgency to economic recovery, and absence of prior membership experience in any grand economic alliance, it is highly unlikely that Bangladesh could afford to absorb the tedious "too American" economic regulatory standards. 

Even neighbouring India – the key cornerstone country in the US-led containment policy against China - was reportedly reluctant to join the IPEF despite relatively better economic infrastructure.        

So far, it appears that the US offers nothing in terms of tangible economic benefit to put meat on the bones of the IPEF. It, rather, seems the US has put forward a long laundry list of standard-setting demands in line with its economic policy, with a clear objective to contain  China's increasing dominance in the Asian supply chain and reestablish its economic leadership in the Indo-Pacific.

So, given that the IPEF seems to be another frontier of the enduring geopolitical turf war between China and the US, should Bangladesh aspire to join the alliance? The answer may lie in the diplomatic trend line it has been following over the decade. 

Over the last decade, Bangladesh has been carrying out a unique "three-way balancing" act between the US, India and China. And, in return, it has reaped astonishing economic and geopolitical dividends on its march toward being an emerging middle power. 

Embroiling itself in any geopolitical power struggle, with sudden divergence from its decade-long diplomatic manoeuvre, could risk its economic and geopolitical status-quo going down wrong.  

Besides, Bangladesh has yet distanced itself from aspiring the membership in the Regional Comprehensive Economic Partnership (RCEP) – a China-led grand economic alliance in the Indo-Pacific region – with a clear aim to maintain its balancing endeavour and not to be labelled as a China-tilted country. Now, it would certainly raise questions about its very diplomatic deftness, should it join the US-led IPEF- a containment tool to the RCEP. 

With Bangladesh's economic and geopolitical stakes being disparately, and evenly distributed among the global powers, it would be quite a risky venture for the country to lean absolutely into the geopolitical realm of any power or to embark on any contradictorily competitive political or economic bloc. It will be instrumental, in the long run, for Bangladesh to deal with global powers "on its own merit" and for powerful ones to recognise Bangladesh's diplomatic posture "in its own right".     

Hossain Delwar. Sketch: TBS

Hossain Delwar is a columnist and analyst focusing on International Politics. 

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.