GTAP Resources: Resource Display
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"India-ASEAN FTA: Implication of Phased Liberalisation" by Nag, Biswajit and Chandrima Sikdar Abstract The India-ASEAN Free Trade Agreement came into effect on January 1, 2010 with respect to Malaysia, Singapore and Thailand. For the remaining ASEAN members it will come into force after they complete their internal requirements. With this background, the present study seeks to analyse the impact of this FTA on India and the selected ASEAN countries following the phased liberalization. It also aims to study the impact of the FTA on Rest of South Asia and other ASEAN members. Using the GTAP database the study conducts a number of simulations involving different scenarios of India’s trade liberalization with ASEAN region and assesses the impact of this liberalization both on the economies’ external sector and their domestic macroeconomic variables. The welfare implications of the FTA for the countries involved are also studied. The simulation results reveal that India’s gain is mainly from the allocative efficiency. However, ASEAN countries receive large terms of trade gain in Indian market. There is a signal that this agreement will increase trade diversion The paper also analyses the impact on various sectors, changes in output, factor demand and factor prices. The paper argues that in the long run after full trade liberalization, India’s allocative efficiency will increase but terms of trade effect will continuously fall and remain negative. India will be able to arrest the fall in terms of trade once the gain in allocative efficiency is used to improve the productivity in the export oriented sectors and achieve economies of scale. |
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- Agricultural policies - Asia (East) |
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Public Access  2011 Conference Paper (295.5 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 9/15/2023 1:05:45 PM
