India asean gravity (original) (raw)
Related papers
Impact of India’s Free Trade Agreement with ASEAN on Its Goods Exports: A Gravity Model Analysis
Economies
The relationship between India and ASEAN has emerged as a crucial basis of their foreign policy. Both the regions signed a Free Trade Agreement in 2009, which came into effect in 2010. They are now reviewing the FTA to further enhance their economic cooperation. At this critical juncture, this study aimed to analyze the trade and export relationship between India and ASEAN and examine the extent to which the AIFTA effectively influenced it. Additionally, the study intended to determine what other factors influenced the trade and export relationship between the two regions and what future changes are needed in order to make this partnership mutually beneficial. To fulfill this objective, a gravity model was applied to a panel data from 2000–2019. A random effect model was utilized for the estimation. The empirical analysis concludes that the adoption of the AIFTA increased trade significantly; however, had no significant impact on raising exports. The study has identified rising NTMs...
Effects of regional trading agreements on South Asian trade: a Gravity model analysis
Tropical Agricultural Research, 2015
Regionalism in South Asia, through formation of regional and bilateral trading agreements, dates back to mid 1990s. The objective of this study is to assess the effects of various forms of trade agreements on bilateral trade of South Asia. Gravity model of international trade was used as the analytical tool and the effects of the World Trade Organization (WTO), Regional Trade Agreements (RTA) such as SAFTA, EU, ASEAN, BIMSTEC and NAFTA, and Bilateral Trade Agreements (BTA) were estimated. Three types of BTAs were included; between two South Asian countries, between a South Asian country and a country not in the region, and between two non-South Asian countries. Distance between the trading partners, sharing of common language, and colonial ties were the remaining explanatory variables included in the models. Cross sectional data covering 2555 bilateral trade for the year 2012 were used for the estimation and the data were extracted from the gravity databases of the Asia Pacific Research and Training Network, the World Bank and the WTO. The models were estimated using Ordinary Least Squares including importer and exporter fixed effects. The results of the estimation suggest that sharing of a common language, sharing a common colony, and membership of WTO positively and significantly affect export values and the effect of geographical distance, as expected, on the same has a negative effect. The memberships in BTA and RTA have mixed effects. Among RTAs used in the study, only the coefficient for EU is statistically significant. SAFTA, ASEAN, BIMSTEC and NAFTA do not show significant effects on bilateral trade. The effects of all BTAs are positive and significant and they indicate that BTAs within South Asia enhance its regional trade greater than the BTAs with non-members. These results suggest that proliferation of BTAs within South Asia helped in expanding regional trade.
Working Papers, 2011
The Asia-Pacific Research and Training Network on Trade (ARTNeT) is aimed at building regional trade policy and facilitation research capacity in developing countries. The ARTNeT Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about trade issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. ARTNeT working papers are available online at www.artnetontrade.org. All material in the working papers may be freely quoted or reprinted, but acknowledgment is requested, together with a copy of the publication containing the quotation or reprint. The use of the working papers for any commercial purpose, including resale, is prohibited.
2003
The emergence of new Asian regionalisms such as ASEAN+3 (China, Korea and Japan) and the proposed ASEAN+5 (ASEAN+3 plus Australia and New Zealand) and other bilateral, plurilateral and multilateral free trade agreements in recent years requires research into these important developments and their underlying fundamental trade-growth causation. The paper extends the gravity theory to time-series data and applies a new flexible modelling approach to construct a simultaneous-equation model of trade and growth for the ASEAN and the East Asia 3. Using data from the World Bank national accounts and CHELEM regional and international trade over the period 1968-2000, the paper then estimates the model by both standard (OLS and 2SLS) and improved estimation methods to provide superior MSE impact estimates. Implications of the findings for ASEAN+3's economic integration, trade policy and prospects for trade and welfare improvement for this FTA will also be discussed.
Impact of Globalisation on India’s exports with special reference to Regional Trade Agreements
FOCUS: Journal of International Business, 2015
Coinciding with the era of globalisation, there has been a rise in the number and depth of Regional Trade Agreements (RTAs) in the Asian region. As India has also been a part of this growing trend, this paper attempt to identify the determinants of India’s exports with special focus on the role of globalisation and RTAs of India. We employ panel data regression on an augmented gravity model to examine the effects of these variables. To capture the globalisation effect, we have included trade openness of the host country. For RTAs, we have taken two variables; one which indicates the presence or absence of an RTA in a given year; and second is the number of RTAs between India and its partner country. Using data for nine countries which are India’s trading partners over the period 1991-2012, we find that GDP and GDP per capita of the host country are significant determinants of India’s exports. Trade openness which is an indicator of globalisation is positive and highly significant in...
2011
The study attempted to analyse the long-term effects of the FTA on India. It is argued that after full trade liberalization, India’s allocative efficiency will increase, but the terms of trade effect will worsen continuously and remain negative. India will be able to arrest the worsening in terms of trade once the gain in allocative efficiency is used to improve productivity in the export-oriented sectors as well as achieve economies of scale.
Reassessing the Impact of the ASEAN-India Free Trade Agreement
Jurnal Ekonomi Malaysia, 2014
(etrru) pada tahun 2009 memberi isyarat bahawa aliran perdagangan antara ASEAN dan India mempunyai potensi untuk dipertingkatkan. Kajian yang lepas menumpu kepada kesan kebajikan perjanjian tersebut serta kesan terhadap perdagangan secora keseluruhan, khususnya dalam b'arang pertanian. Tujuan pertama kajian ini ialah untuk membanding kesan AIFTA terhadap eksport barang perkilangan dari ASEAN ke India dan dari India ke ASEAN. Tujuan kedua ialah untuk menentu kepentingan relatifantara liberalisasi tarif yang dijadualkan dalam AIFrA denganfaktor lain yang menyumbang kepada eksport barang perkilangan antara ASEAN dan India dan sebalihtya. Kajian ini menggunakan model graviti sebab model tersebut mebenarkan pembolehubah lain sebagai pembolehubah kawalan untukmengukur salah satu perubahan dalam perdagangan negara sebagai hasil persetujuan tersebut. Penemuan utama kajian ini menunjukkan bahawa ASEAN mendapatfaedah yang lebih berbanding dengan India daripada liberalisqsi tarif dalam persetujuan ini. Namun, kesan liberalisasi tarif terhadap eksport perkilangan antara ASEAN dan India adalah lebih kecil secara relative berbanding dengan faktor lain, khususnya kos perdagangan. Justeru itu, AIFTA perlu memperkukuhkan tindakan yang khusus untuk fasilitasi perdagangan dalam persetujuan ini untuk meningkatkan elcsport perkilangan dari ,qsz,ql| ke India dan sebalilatya. Kata kunci: ASEAN-India (tnrt); model graviti; tarif; ASEAN-|; India; eksport; barang perkilangan ABSTMCT The ratifcation of the ASEAN-India Free Trade Agreement (AIFTA) in 2009 signals a potentialfor increased tradefiows between ASEAN and India. Previous studies havefocussed mainly on the welfare impact of the agreement and its impact on overall trade, especially trade in agricultural products. Thefrst objective ofthis study seeks to compare the impact ofthe urrl on the exports ofmanufactured goods from ASEAN to India and vice versa. The second is to ascertain the relative importance of the scheduled tariff liberalization in the AIFTA compared with other contributory factors in the export of mandactured goods between ASEAN and India. The study uses an augmented gravity model as this type of model allowsfor the control of other trade related variables and to quantifu any changes in a country's trade due to the agreement. The mainfindings in this study indicate that ASEAN gains morefrom the scheduled tariff liberalization in this agreement compared to India. However, the impact of tariff liberalization on the exports of manufactured goods from ASEAN and India with each other is relatively smaller compared to other contributory factors, especially trade costs. The AIFTA will have to strengthen specifc trade facilitation measures in the agreement in order to increase exports of manufactutred goods from ASEAN to India and vice versa.
DRAFT From SAPTA to SAFTA: Gravity Analysis of South Asian Free Trade
South Asian Association for Regional Cooperation (SAARC) was established in 1985 and South Asian Preferential Trading Arrangement (SAPTA) came into existence in 1995. Four rounds of trade negotiations have already been concluded under SAPTA by 2002. SAARC countries have signed the framework agreement on South Asian Free Trade Area (SAFTA) in 2004 and SAFTA will come into effect at the start of 2006. We use the gravity model analysis to evaluate the progress of SAPTA and the prospects for SAFTA using trade data for 1996-2002. Both panel data and cross sectional data analysis have been used. Our gravity model results show that there is a significant trade creation effect under SAPTA and find no evidence of trade diversion effect with the rest of the world. This supports the proposition that further regional integration may bring about substantial benefits to SAARC region and South Asian Free Trade Area is most likely to promote intra-regional trade through further dismantling of tariff and other non-tariff barriers to trade among members.
The India-ASEAN Free Trade Agreement: How Will Indian Industries Be Affected?
SSRN Electronic Journal, 2014
In this paper we apply the gravity model to international trade transactions between India and the ASEAN countries. The model is applied to all HS 6-digit codes for which trade between India and ASEAN takes place. The estimated equation is then used to simulate the trade impact under the alternative scenario of a Free Trade Agreement (FTA) between the two countries. The results of these simulations are then presented to find out the possible impact of the India ASEAN FTA on individual industries. Initially the analysis was done at the 2 digit HS level. However we found that the same set of industries at the two digit level will be both favourably and adversely affected due to the FTA. This necessitated disaggregation at the 6 digit, where individual industries in ASEAN that will be able to increase their export to India and the ones for which export by India will increase could be separated. The main conclusion is that intermediate goods will be more affected (both adversely and favourably for India) than final goods. Other conclusions include the fact that about fifty percent of the 6 digit products have insignificant tariff elasticity or the elasticity coefficient (even simple correlation between the rate of tariff and import) is of the wrong sign. The implication is obvious: tariffs do not matter at all for a major part of the industries and for them the agreement has no significance. In fact some of the most debated commodities fall in this category. For many of them though tariff rates have steadily increased overtime so has imports imparting a wrong sign to the tariff elasticity which means that reasons other than tariffs determine their imports and there is no point in putting them in the sensitive or exclusion list.