India, Japan, Australia, and the US have decided to revive the Quadrilateral Security Dialogue alliance (Quad), with a new focus on building resilient supply chains. The Quad is now focusing on creating a new COVID-19 vaccine value chain, but it aims to expand into renewable technology. Arijit De, Vishal Rana, and Parth Patel write that if the Quad is to be successful, it needs to engage other countries to increase its reach and influence

De, Arijit

Patel, Parth

Rana, Vishal

English

The University of Manchester - Institutional Repository

The University of Manchester ResearchQuadDOI:https://eprints.lse.ac.uk/111651/Link to publication record in Manchester Research ExplorerCitation for published version (APA):De, A., Rana, V., & Patel, P. (2021, Jul 1). Quad: countering Chinese dominance by building new supply chains.https://doi.org/https://eprints.lse.ac.uk/111651/Citing this paperPlease note that where the full-text provided on Manchester Research Explorer is the Author Accepted Manuscriptor Proof version this may differ from the final Published version. If citing, it is advised that you check and use thepublisher's definitive version.General rightsCopyright and moral rights for the publications made accessible in the Research Explorer are retained by theauthors and/or other copyright owners and it is a condition of accessing publications that users recognise andabide by the legal requirements associated with these rights.Takedown policyIf you believe that this document breaches copyright please refer to the University of Manchester’s TakedownProcedures [http://man.ac.uk/04Y6Bo] or contact uml.scholarlycommunications@manchester.ac.uk providingrelevant details, so we can investigate your claim.Download date:27. Sep. 2023Quad:	countering	Chinese	dominance	by	building	newsupply	chainsIndia,	Japan,	Australia,	and	the	US	have	decided	to	revive	the	Quadrilateral	Security	Dialogue	alliance	(Quad),	witha	new	focus	on	building	resilient	supply	chains.	The	Quad	is	now	focusing	on	creating	a	new	COVID-19	vaccinevalue	chain,	but	it	aims	to	expand	into	renewable	technology.	Arijit	De,	Vishal	Rana,	and	Parth	Patel	write	that	ifthe	Quad	is	to	be	successful,	it	needs	to	engage	other	countries	to	increase	its	reach	and	influence.	The	Quadrilateral	Security	Dialogue,	also	known	as	Quad,	is	a	strategic	dialogue	and	alliance	between	fourdemocracies:	India,	Japan,	Australia	and	the	US.	The	Quad	was	created	to	counter	a	rising	power,	China,	who	inrecent	times	has	been	perceived	as	a	threat	to	other	developing	and	less-developed	nations.	We	look	at	the	Quadfrom	the	perspective	of	global	supply	chains.So,	what	is	the	Quad?	The	dialogue	was	initiated	in	2007	by	Prime	Minister	Shinzo	Abe	of	Japan	and	since	thenhad	taken	a	back	seat	after	Australian	Prime	Minister	Kevin	Rudd’s	uneasiness	in	dealing	with	China.	Ruddwas	educated	in	Chinese	Studies,	including	Chinese	language,	and	in	the	past	acted	as	the	First	Secretary	of	theAustralian	Embassy	in	Beijing.In	2017,	all	four	member	nations	decided	to	revive	the	Quad	primarily	to	counter	China	militarily	and	diplomaticallyin	the	South	China	Sea.	Since	then,	the	alliance	has	been	gaining	momentum	towards	becoming	strategicallyimportant	for	its	four	member	countries.	For	instance,	in	November	2020,	after	a	long	time	since	joining	thisalliance,	Australia	participated	in	the	Malabar	Exercise,	a	series	of	naval	drills	with	the	remaining	members.	InFebruary	2021,	the	four	leaders	met	in	Tokyo	for	the	Quad	Summit	to	discuss	how	the	alliance	can	be	bolsteredbeyond	its	military	dimensions.There	are	many	conspiracy	theories	suggesting	that	the	SARS-CoV-2	virus,	which	leads	to	COVID-19,	could	havebeen	a	biological	weapon	developed	by	China	in	its	Wuhan	Institute	of	Virology	laboratory.	While	the	focus	of	thispiece	is	not	on	whether	there	is	any	substance	to	these	theories,	and	the	investigations	will	take	their	own	course,one	thing	is	clear:	the	pandemic	has	become	a	major	stumbling	block	for	the	Chinese	government.	It	has	created	ahuge	trust	deficit	and	the	world	has	no	choice	but	to	look	for	ways	to	reduce	its	dependence	on	China,	specificallyfor	the	supply	of	goods	and	services.	This	is	where	the	Quad	alliance	is	now	expanding	its	dialogue.A	vaccine	supply	chainThe	leaders	of	the	alliance	aim	to	collaborate	and	create	a	resilient	supply	chain	to	deal	with	the	COVID-19pandemic.	They	want	to	ensure	that	vaccines	are	developed	in	the	US,	manufactured	in	India,	and	financed	byJapan	and	the	US,	as	well	as	supported	by	Australia	through	logistics	and	last-mile	distribution.This	initiative	has	the	potential	to	enhance	India’s	manufacturing	capacity	in	pharmaceuticals	and	increase	exportsto	the	Indo-Pacific	region.	By	focusing	on	the	strengths	and	capacities	of	each	member,	the	Quad	can	expediteglobal	vaccine	delivery,	helping	to	bridge	the	vaccine	demand-supply	gap.	One	goal	is	to	deliver	1	billion	vaccinesto	the	Association	of	Southeast	Asian	Nations	(ASEAN)	by	the	end	of	2022.India’s	role	within	this	vaccine	initiative	can	potentially	reinforce	the	country’s	credentials	as	a	trusted	manufacturerof	quality	vaccines	and	strengthen	its	reputation	as	the	“pharmacy	of	the	world”.	Vaccine	manufacturing	within	Quadsupply	chains	could	provide	India	with	a	major	competitive	advantage	in	the	pharmaceutical	sector,	withoutconcerns	about	market	accessibility	and	intellectual	property	rights.	Also,	access	to	advanced	technologies	wouldgive	a	boost	to	India’s	research	and	development	(R&D).Securing	a	supply	chain	for	renewable	technologyLSE Business Review: Quad: countering Chinese dominance by building new supply chains Page 1 of 2		Date originally posted: 2021-07-01Permalink: https://blogs.lse.ac.uk/businessreview/2021/07/01/quad-countering-chinese-dominance-by-building-new-supply-chains/Blog homepage: https://blogs.lse.ac.uk/businessreview/The	Quad	could	help	overcome	territorial	disputes	that	have	disrupted	the	existing	global	supply	chain	and	advancethe	security	and	economic	interests	of	the	member	nations.	One	aim	is	to	collaborate	in	addressing	climate	changeby	advancing	a	credible	alternative	to	China-driven	supply	chains,	creating	new	value	chains	for	renewabletechnology	under	the	regional	comprehensive	economic	partnership	(RCEP).Currently,	any	trade	tension	between	China	and	other	Quad	nations	can	disrupt	trade.	To	reduce	overreliance	onChina,	a	Quad-led	solar	technology	chain	should	build	an	alternative	manufacturing	base	in	India.	This	would	helpalliance	members	achieve	their	solar	energy	targets.	It	would	also	explore	the	Indo-Pacific	market	for	solartechnologies,	eliminating	the	risk	of	an	intentional	trade	halt,	which	could	adversely	impact	the	Indo-Pacific	region.Another	goal	is	to	procure	rare-earth	metals,	making	alliance	members	resilient	to	Chinese	dominance.	Accordingto	the	US	geological	survey	report,	China	produced	nearly	58	per	cent	of	the	world’s	rare-earth	metals	in	2020,down	from	90	per	cent	some	four	years	ago,	as	the	US	and	Australia	gradually	increased	their	production.	Theserare-earth	metals	are	crucial	for	the	manufacturing	of	smartphones,	computers,	hard-disk	drives,	laptops,	high-performance	motors,	electric	vehicle	batteries,	wind	turbines	and	other	components	of	the	“decarbonisation”infrastructure.In	2020,	the	US,	Australia,	and	India	accounted	for	16	per	cent,	7	per	cent	and	1	per	cent	respectively	of	the	globalrare-earth	metal	production.	India	accounts	for	6	per	cent	of	the	world’s	rare-earth	reserves,	while	Japan	is	one	ofthe	biggest	rare-earth	consumers.	The	global	demand	of	rare-earth	elements	could	reach	a	staggering	51.9thousand	metric	tonnes	by	2030	(See	the	article	by	Zhou,	Li	and	Chen,	2017	for	more	details	on	the	currentdemand).	The	Quad	will	have	to	collaborate	along	the	supply	chain	of	rare-earth	metals,	from	production	toconsumption,	to	increase	their	influence	in	this	sector	and	counter	the	dominant	role	currently	played	by	China.There	is	growing	agreement	between	Quad	members	that	as	China	continues	to	rise	as	the	next	superpower,	thereis	a	greater	need	for	preserving	the	rules-based	order	for	a	free	and	open	Indo-Pacific	that	respects	territorialintegrity	and	sovereignty.	At	the	same	time,	the	Quad’s	ability	to	present	a	viable	alternative	for	promoting	freetrade	can	be	a	giant	leap	forward.	While	some	experts	and	thinktanks	view	the	Quad’s	role	as	purely	counteringChina’s	rise,	others	see	it	as	an	opportunity	to	create	new	economic	possibilities.	No	matter	how	you	see	it,	it	isclear	that	the	Quad	has	grown	in	stature	and	has	already	made	a	major	impact	on	international	relations.	So	muchso	that	China	is	warning	some	countries	against	joining	the	alliance.If	the	Quad	is	to	be	really	successful	in	countering	an	increasingly	assertive	China,	it	will	need	to	extend	itscooperation	into	various	spheres.	It	will	also	need	to	pursue	a	more	aggressive	diplomacy	by	engaging	othercountries	to	increase	its	reach	and	influence.	If	the	Quad	manages	to	do	this,	then	it	will	present	a	seriouscounterbalance	to	China’s	rise	and	assertiveness	in	South	Asia	and	the	Indo-Pacific	region.♣♣♣Notes:This	blog	post	expresses	the	views	of	its	author(s),	and	do	notnecessarily	represent	those	of	LSE	Business	Review	or	the	LondonSchool	of	Economics.	Featured	image	by	Bruce	Röttgers	on	Unsplash		When	you	leave	a	comment,	you’re	agreeing	to	our	Comment	Policy		LSE Business Review: Quad: countering Chinese dominance by building new supply chains Page 2 of 2		Date originally posted: 2021-07-01Permalink: https://blogs.lse.ac.uk/businessreview/2021/07/01/quad-countering-chinese-dominance-by-building-new-supply-chains/Blog homepage: https://blogs.lse.ac.uk/businessreview/

Quad:countering Chinese dominance by building new supply chains

LSE Research Online

Quad:	countering	Chinese	dominance	by	building	newsupply	chainsIndia,	Japan,	Australia,	and	the	US	have	decided	to	revive	the	Quadrilateral	Security	Dialogue	alliance	(Quad),	witha	new	focus	on	building	resilient	supply	chains.	The	Quad	is	now	focusing	on	creating	a	new	COVID-19	vaccinevalue	chain,	but	it	aims	to	expand	into	renewable	technology.	Arijit	De,	Vishal	Rana,	and	Parth	Patel	write	that	ifthe	Quad	is	to	be	successful,	it	needs	to	engage	other	countries	to	increase	its	reach	and	influence.	The	Quadrilateral	Security	Dialogue,	also	known	as	Quad,	is	a	strategic	dialogue	and	alliance	between	fourdemocracies:	India,	Japan,	Australia	and	the	US.	The	Quad	was	created	to	counter	a	rising	power,	China,	who	inrecent	times	has	been	perceived	as	a	threat	to	other	developing	and	less-developed	nations.	We	look	at	the	Quadfrom	the	perspective	of	global	supply	chains.So,	what	is	the	Quad?	The	dialogue	was	initiated	in	2007	by	Prime	Minister	Shinzo	Abe	of	Japan	and	since	thenhad	taken	a	back	seat	after	Australian	Prime	Minister	Kevin	Rudd’s	uneasiness	in	dealing	with	China.	Ruddwas	educated	in	Chinese	Studies,	including	Chinese	language,	and	in	the	past	acted	as	the	First	Secretary	of	theAustralian	Embassy	in	Beijing.In	2017,	all	four	member	nations	decided	to	revive	the	Quad	primarily	to	counter	China	militarily	and	diplomaticallyin	the	South	China	Sea.	Since	then,	the	alliance	has	been	gaining	momentum	towards	becoming	strategicallyimportant	for	its	four	member	countries.	For	instance,	in	November	2020,	after	a	long	time	since	joining	thisalliance,	Australia	participated	in	the	Malabar	Exercise,	a	series	of	naval	drills	with	the	remaining	members.	InFebruary	2021,	the	four	leaders	met	in	Tokyo	for	the	Quad	Summit	to	discuss	how	the	alliance	can	be	bolsteredbeyond	its	military	dimensions.There	are	many	conspiracy	theories	suggesting	that	the	SARS-CoV-2	virus,	which	leads	to	COVID-19,	could	havebeen	a	biological	weapon	developed	by	China	in	its	Wuhan	Institute	of	Virology	laboratory.	While	the	focus	of	thispiece	is	not	on	whether	there	is	any	substance	to	these	theories,	and	the	investigations	will	take	their	own	course,one	thing	is	clear:	the	pandemic	has	become	a	major	stumbling	block	for	the	Chinese	government.	It	has	created	ahuge	trust	deficit	and	the	world	has	no	choice	but	to	look	for	ways	to	reduce	its	dependence	on	China,	specificallyfor	the	supply	of	goods	and	services.	This	is	where	the	Quad	alliance	is	now	expanding	its	dialogue.A	vaccine	supply	chainThe	leaders	of	the	alliance	aim	to	collaborate	and	create	a	resilient	supply	chain	to	deal	with	the	COVID-19pandemic.	They	want	to	ensure	that	vaccines	are	developed	in	the	US,	manufactured	in	India,	and	financed	byJapan	and	the	US,	as	well	as	supported	by	Australia	through	logistics	and	last-mile	distribution.This	initiative	has	the	potential	to	enhance	India’s	manufacturing	capacity	in	pharmaceuticals	and	increase	exportsto	the	Indo-Pacific	region.	By	focusing	on	the	strengths	and	capacities	of	each	member,	the	Quad	can	expediteglobal	vaccine	delivery,	helping	to	bridge	the	vaccine	demand-supply	gap.	One	goal	is	to	deliver	1	billion	vaccinesto	the	Association	of	Southeast	Asian	Nations	(ASEAN)	by	the	end	of	2022.India’s	role	within	this	vaccine	initiative	can	potentially	reinforce	the	country’s	credentials	as	a	trusted	manufacturerof	quality	vaccines	and	strengthen	its	reputation	as	the	“pharmacy	of	the	world”.	Vaccine	manufacturing	within	Quadsupply	chains	could	provide	India	with	a	major	competitive	advantage	in	the	pharmaceutical	sector,	withoutconcerns	about	market	accessibility	and	intellectual	property	rights.	Also,	access	to	advanced	technologies	wouldgive	a	boost	to	India’s	research	and	development	(R&D).Securing	a	supply	chain	for	renewable	technologyLSE Business Review: Quad: countering Chinese dominance by building new supply chains Page 1 of 2		Date originally posted: 2021-07-01Permalink: https://blogs.lse.ac.uk/businessreview/2021/07/01/quad-countering-chinese-dominance-by-building-new-supply-chains/Blog homepage: https://blogs.lse.ac.uk/businessreview/The	Quad	could	help	overcome	territorial	disputes	that	have	disrupted	the	existing	global	supply	chain	and	advancethe	security	and	economic	interests	of	the	member	nations.	One	aim	is	to	collaborate	in	addressing	climate	changeby	advancing	a	credible	alternative	to	China-driven	supply	chains,	creating	new	value	chains	for	renewabletechnology	under	the	regional	comprehensive	economic	partnership	(RCEP).Currently,	any	trade	tension	between	China	and	other	Quad	nations	can	disrupt	trade.	To	reduce	overreliance	onChina,	a	Quad-led	solar	technology	chain	should	build	an	alternative	manufacturing	base	in	India.	This	would	helpalliance	members	achieve	their	solar	energy	targets.	It	would	also	explore	the	Indo-Pacific	market	for	solartechnologies,	eliminating	the	risk	of	an	intentional	trade	halt,	which	could	adversely	impact	the	Indo-Pacific	region.Another	goal	is	to	procure	rare-earth	metals,	making	alliance	members	resilient	to	Chinese	dominance.	Accordingto	the	US	geological	survey	report,	China	produced	nearly	58	per	cent	of	the	world’s	rare-earth	metals	in	2020,down	from	90	per	cent	some	four	years	ago,	as	the	US	and	Australia	gradually	increased	their	production.	Theserare-earth	metals	are	crucial	for	the	manufacturing	of	smartphones,	computers,	hard-disk	drives,	laptops,	high-performance	motors,	electric	vehicle	batteries,	wind	turbines	and	other	components	of	the	“decarbonisation”infrastructure.In	2020,	the	US,	Australia,	and	India	accounted	for	16	per	cent,	7	per	cent	and	1	per	cent	respectively	of	the	globalrare-earth	metal	production.	India	accounts	for	6	per	cent	of	the	world’s	rare-earth	reserves,	while	Japan	is	one	ofthe	biggest	rare-earth	consumers.	The	global	demand	of	rare-earth	elements	could	reach	a	staggering	51.9thousand	metric	tonnes	by	2030	(See	the	article	by	Zhou,	Li	and	Chen,	2017	for	more	details	on	the	currentdemand).	The	Quad	will	have	to	collaborate	along	the	supply	chain	of	rare-earth	metals,	from	production	toconsumption,	to	increase	their	influence	in	this	sector	and	counter	the	dominant	role	currently	played	by	China.There	is	growing	agreement	between	Quad	members	that	as	China	continues	to	rise	as	the	next	superpower,	thereis	a	greater	need	for	preserving	the	rules-based	order	for	a	free	and	open	Indo-Pacific	that	respects	territorialintegrity	and	sovereignty.	At	the	same	time,	the	Quad’s	ability	to	present	a	viable	alternative	for	promoting	freetrade	can	be	a	giant	leap	forward.	While	some	experts	and	thinktanks	view	the	Quad’s	role	as	purely	counteringChina’s	rise,	others	see	it	as	an	opportunity	to	create	new	economic	possibilities.	No	matter	how	you	see	it,	it	isclear	that	the	Quad	has	grown	in	stature	and	has	already	made	a	major	impact	on	international	relations.	So	muchso	that	China	is	warning	some	countries	against	joining	the	alliance.If	the	Quad	is	to	be	really	successful	in	countering	an	increasingly	assertive	China,	it	will	need	to	extend	itscooperation	into	various	spheres.	It	will	also	need	to	pursue	a	more	aggressive	diplomacy	by	engaging	othercountries	to	increase	its	reach	and	influence.	If	the	Quad	manages	to	do	this,	then	it	will	present	a	seriouscounterbalance	to	China’s	rise	and	assertiveness	in	South	Asia	and	the	Indo-Pacific	region.♣♣♣Notes:This	blog	post	expresses	the	views	of	its	author(s),	and	do	notnecessarily	represent	those	of	LSE	Business	Review	or	the	LondonSchool	of	Economics.	Featured	image	by	Bruce	Röttgers	on	Unsplash		When	you	leave	a	comment,	you’re	agreeing	to	our	Comment	Policy		LSE Business Review: Quad: countering Chinese dominance by building new supply chains Page 2 of 2		Date originally posted: 2021-07-01Permalink: https://blogs.lse.ac.uk/businessreview/2021/07/01/quad-countering-chinese-dominance-by-building-new-supply-chains/Blog homepage: https://blogs.lse.ac.uk/businessreview/

Quad: countering Chinese dominance by building new supply chains

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Quad: countering Chinese dominance by building new supply chains

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