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South Asia’s Economic Integration with East Asia: An Exploratory Analysis with a Focus on India

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  • Anbumozhi, Venkatachalam

    (1Economic Research Institute for ASEAN and East Asia, Indonesia)

  • Kalirajan, Kaliappa

    (The Australian National University, Australia)

Abstract

Economic integration of South Asia and East Asia has been growing steadily since the 1990s, fuelled by domestic reforms and the emergence of regional supply chains. Within South Asia, India emerged as the largest trading partner and investment destination for East Asian economies. With its new Act East Policy, India has been proactively looking at free trade agreements with Association of Southeast Asian Nation and East Asia, which has brought benefits to South Asia in terms of improved trade and increased investment. This paper assesses the experience of the economic integration of South Asia and East Asia by addressing questions such as the extent of trade integration achieved and impediments to deepening integration. It found that trade and investment linkages are growing as well as casually related. However, attaining the full potential of economic integration is constrained by the insufficient depth in the use of existing trade agreements, barriers to service trade, and poor infrastructure connectivity. Expansion of Regional Comprehensive Economic Cooperation would significantly enhance economic integration of South Asia, particularly India, and East Asia.

Suggested Citation

  • Anbumozhi, Venkatachalam & Kalirajan, Kaliappa, 2020. "South Asia’s Economic Integration with East Asia: An Exploratory Analysis with a Focus on India," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 35(1), pages 91-110.
    • Handle: RePEc:ris:integr:0791
    DOI: 10.11130/jei.2020.35.1.91
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    References listed on IDEAS

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    1. Peter DRYSDALE & Shiro ARMSTRONG, 2010. "International and Regional Cooperation: Asia's Role and Responsibilities," Asian Economic Policy Review, Japan Center for Economic Research, vol. 5(2), pages 157-173, December.
    2. Barry Eichengreen & Poonam Gupta, 2010. "The Service Sector as India’s Road to Economic Growth?," Development Economics Working Papers 23030, East Asian Bureau of Economic Research.
    3. Pradumna B Rana & John Malcolm Dowling, 2009. "South Asia:Rising to the Challenge of Globalization," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 6837, December.
    4. Noland, Marcus & Park, Donghyun & Estrada, Gemma B., 2012. "Developing the Service Sector as Engine of Growth for Asia: An Overview," ADB Economics Working Paper Series 320, Asian Development Bank.
    5. Shiro Armstrong & Peter Drysdale & Kaliappa Kalirajan, 2008. "Asian Trade Structures and Trade Potential : An Initial Analysis of South and East Asian Trade," EABER Working Papers 21753, East Asian Bureau of Economic Research.
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    Cited by:

    1. Swetha Loganathan & Joshy Joseph Karakunnel & Vijay Victor, 2021. "India–European Union Trade Integration: An Analysis of Current and Future Trajectories," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 15(4), pages 484-504, November.

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    More about this item

    Keywords

    Economic Integration; Infrastructure; Free Trade Agreements; Foreign Direct Investment; Regional Cooperation;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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