Japan's Foreign Direct Investment Experiences in India: Lessons Learnt from Firm Level Surveys
AbstractThough economic relations between India and Korea have been strengthening, the current size of trade and investment between the two countries is relatively low compared to the size and structural complementarities of the two economies. In this context, the present paper analyses trade and investment relations and explores future areas of potential co-operation between India and Korea. We find that the increase in merchandise trade between the two countries has been mainly because of the changing demand structure and comparative advantages of both the economies in complementary sectors in recent years. The Revealed Comparative Advantage (RCA) analysis, at both the aggregated and disaggregated levels, shows that while Korea has been specialising in a few, high value-added manufacturing products, India's exports have been more diversified. The analysis also indicates that both the countries have comparative advantages in different products in the same industry, revealing the opportunity for intra-industry trade (IIT). Moreover, the increasing trade complementarity index (TCI) shows that Indian and Korean trade gradually has become more compatible over time, indicating that any agreement between the two countries is likely to enhance trade flows. The trade intensities between the two countries reveal that Korea is doing much better and there is scope for India to improve its export intensity with Korea. The study also suggests the areas where there is huge scope for increased investment and technological collaboration between the two countries. Further, there is huge potential for trade in services in areas such as information technology, science and technology, pharmaceutical industry, broadcasting, tourism, healthcare and human resource development. Removal of tariff and non-tariff barriers, especially sector specific barriers, will give a major boost to bilateral trade and investment relations.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Indian Council for Research on International Economic Relations, New Delhi, India in its series Indian Council for Research on International Economic Relations, New Delhi Working Papers with number 243.
Length: 52 Pages
Date of creation:
Date of revision:
Contact details of provider:
Postal: India Habitat Centre, Core 6A, Lodhi Road, New Delhi 110 003
Web page: http://www.icrier.res.in
More information through EDIRC
Foreign direct investment; Japanese multinational corporations; strategies; obstacles in operations.;
Find related papers by JEL classification:
- F0 - International Economics - - General
- F1 - International Economics - - Trade
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- N85 - Economic History - - Micro-Business History - - - Asia including Middle East
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (G.K. Manjunath).
If references are entirely missing, you can add them using this form.