Yellen dubs India 'indispensable partner' for friendshoring, calls for redoubling support to Ukraine

US Treasury Secretary Janey Yellen on Sunday laid emphasis on India's significant role in boosting supply chain resilience through friendshoring.

During a press conference in Gandhinagar, she expressed gratitude to Finance Minister Nirmala Sitharaman and further discussed the agenda for global economic growth.

She appreciated India as an indispensable partner in the strategy of "friendshoring" to bolster supply chain resilience.

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Friendshoring is a strategy where a country sources raw materials, components and even manufactured goods from countries that share its values.

“Friendshoring is an important foundation of our approach to increasing resilience of our supply chains, and we see India as an indispensable partner in that and I hope to use this trip to deepen what is already a significant relationship with respect to friendshoring that the US and India have," said Yellen.

Yellen highlighted the significance of deepening the already influential relationship between the United States and India in the context of friendshoring. She then acknowledged India's key role, further recognising the country as a valuable partner in achieving resilient and robust supply chains.

India seen as 'excellent place' to be producing and exporting to US, says Yellen

The private sector is an essential point of friendshoring, and private firms have continued to make announcements of investing in India as they see India as "an excellent place to be producing and exporting to the US," she said.

The United States Secretary of the Treasury then underlined the top agendas of this week which included, debt distress in emerging markets and developing countries, multilateral development bank evolution, support for Ukraine, and a global tax deal.

Further elucidating on the agendas, she said that the debt vulnerabilities for many countries ascended as a result of the COVID pandemic and Russia's "illegal" war against Ukraine, with the share of countries in debt distress doubling compared to 2015, she said.

“Restoring debt sustainability can help unlock the massive economic potential of developing nations. It can help them regain lost growth and development and enable them to make investments to address challenges that we are trying to tackle together,” she said.

When these countries develop and contribute to the global economy, "all of us benefit," Yellen said.

She then said that the United States Treasury is ready to serve as a partner for the International Monetary Fund's (IMF) Poverty Reduction and Growth Trust - the PRGT.

"I expect the IMF to develop a set of options to do so. My team at Treasury is ready to serve as a partner for the IMF as it considers the options at its disposal-like using the internally generated resources of the fund to support the PRGT subsidy account," she said.

"The United States will continue to build momentum for a collective initiative to evolve the multilateral development banks (MDBs)," Yellen said.

“Our reforms to the World Bank's balance sheet will responsibly unlock as much as USD 50 billion in additional lending capacity over the next decade. As part of our evolution agenda, we estimate that the MDBs as a system could unlock USD 200 billion over the next decade just from the measures already being implemented or under deliberation,” she said.

“This is USD 200 billion more in funding that we can use to advance key global priorities: spurring economic growth and reducing poverty, fighting climate change, and promoting human development,” she said.

“As we take these actions, we recognise that public financing alone cannot fully deliver on the massive challenges that face us. That's why it is essential that development banks ramp up their private capital mobilisation rates,” she added.

Redouble support for Ukraine

She then said that her other priority this week would be to redouble support for Ukraine as it continues to defend itself against Russia's “illegal and unprovoked attack.”

“Let me be clear: our coalition's support for Ukraine is unequivocal. The United States will stand with Ukraine for as long as it takes. And I know the allies and partners in our coalition will do so as well,” she said.

“We will also continue to cut off Russia's access to the military equipment and technologies that it needs to wage war against Ukraine. One of our core goals this year is to combat Russia's efforts to evade our sanctions. Our coalition is building on the actions we've taken in recent months to crack down on these efforts," she further added.

(With inputs from agencies)

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