NEW DELHI – Supply chains, Russia's war in Ukraine and the impact of COVID-19 were top issues for U.S. Treasury Secretary Janet Yellen as she met with Indian government and business leaders Friday in New Delhi.
Both Yellen and Indian Finance Minister Nirmala Sitharaman called for the strengthening of supply chains with trusted trading partners in the Indo-Pacific region to diversify away from countries that present geopolitical and security risks.
Yellen said Russia has weaponized its natural gas supplies against the people of Europe and China currently dominates over 80% of global solar panel production.
She said India and the United States could work together "to advance our shared goals, including mitigating the existential risk of climate change, evolving multilateral institutions, and addressing the debt burden faced by many developing countries."
She made the remarks at the start of a U.S.-India Economic and Financial Partnership Meeting after her discussions with Sitharaman.
Sitharaman said India considered the United States a "trusted friend" and the four-nation Quad and the Indo-Pacific Economic Framework to be key cornerstones of bilateral engagement "in developing sustainable economies, ensuring global health security, resilient supply chains, clean energy technologies, green infrastructure and climate finance."
The Quad, comprised of the United States, India, Australia and Japan, is meant to deepen economic, diplomatic and military ties.
For too long, countries around the world have been overly dependent on risky countries or a single source for critical inputs, Yellen told technology sector leaders during a visit to the Microsoft India Development Center on the outskirts of New Delhi.
She said Russian President Vladimir Putin’s strategy to withhold energy supplies is “an example of how malicious actors can use their market positions to try to gain geopolitical leverage or disrupt trade for their own gain.”
Yellen said the U.S. is providing America’s largest solar manufacturer with up to $500 million in debt financing to build a facility in southern Tamil Nadu state in India. The facility will boost India’s solar manufacturing capacity and help diversify supply chains away from China, she said.
China's strict “zero-COVID” policy has also affected global supply chains with widespread lockdowns in major financial and manufacturing hubs.
Apple announced Sunday that customers will have to wait longer to get its latest iPhone models after anti-virus restrictions were imposed on a contractor’s factory in central China.
The United States is pursuing an approach called “friend-shoring” to diversify away from countries that present geopolitical and security risks to supply chains. “To do so, we are proactively deepening economic integration with trusted trading partners like India,” Yellen said.
“Technology companies like Amazon and Google are investing in India and Vietnam. Apple recently announced that it was shifting some iPhone manufacturing from China to India,” she said.
New supply chains already are developing across regions from Asia to the European Union, she added.
At the U.S.-India Economic and Financial Partnership dialogue, she met with executives from major Indian companies and U.S. companies operating in India.
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