US Treasury Secretary Janet Yellen met business leaders at Microsoft India Development Centre in Uttar Pradesh’s Noida on Friday and explained the US approach to ‘friend-shoring’ which will help strengthen supply chains across the world.
‘Friend-shoring’ means manufacturing and sourcing components and raw materials within a group of countries with shared values, according to a report by the Guardian.
“We are proactively deepening economic integration with trusted trading partners like India. Our strategy will also create redundancies in our supply chain to mitigate over-concentration risks. And we are also addressing our reliance on manufacturers whose approaches clash with our human rights values,” Yellen said at the business leaders meet in Uttar Pradesh.
Yellen attempted to warn India regarding its energy ties with Russia and said that Russia is weaponizing its energy exports against the people of Europe and Ukraine. “It’s 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 US Treasury Secretary’s comments are a reflection of how the US and the G7 is viewing energy ties between Moscow and New Delhi. The G7 and the US has been critical subtly as well as overtly of India’s energy purchases from Russia, at times without taking into account that Europe imports more energy than India from Russia and Russia is still not among the top exporters of energy to India.
She, however, went on to explain that the US is in the process of integration with the large group of countries that it can count on, which includes developing, developed and emerging countries. She pointed out that the US’ development finance institution provided America’s largest solar manufacturer up to $500 million in debt financing to build a facility in Tamil Nadu which will help diversify supply chains away from China.
She pointed out that China dominates over 80% of global solar panel production.
“We are already seeing progress. New supply chains are developing across regions from Asia to the European Union. We are also seeing signs that Western firms are diversifying their supply chains beyond China,” Yellen said.
Yellen will meet her counterpart Union finance minister Nirmala Sitharaman and participate in the US-India Economic and Financial Partnership (IFP) in Delhi, later on in the day.
(with inputs from Shalinder Wangu)
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